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Chapter 7
Chapter 7 Discharge
An individual Chapter 7 debtor
must be granted a bankruptcy discharge, unless one of the ten independent statutory
grounds for denial of a Chapter 7 discharge applies. Bankruptcy code §727(a). The
effect of the discharge is to discharge the bankruptcy debtor from all debts that
arose prior to the order for relief under Chapter 7, as well as from all
debts that, under Bankruptcy Code section 502, are treated as
pre-petition debts.
A Fresh Start
One of the primary purposes of bankruptcy is to discharge certain debts to give an honest individual debtor a "fresh start." The debtor has no liability for discharged debts. In a chapter 7 bankruptcy case, however, a discharge is only available to individual debtors, not to partnerships or corporations. Although an individual chapter 7 case usually results in a bankruptcy discharge of debts, the right to a bankruptcy discharge is not absolute, and some types of debts are not discharged. Moreover, a bankruptcy discharge does not extinguish a lien on property.Denial of Discharge
Exception; non-dischargeable debts: The bankruptcy discharge does
not include particular debts that the court has determined to be
non-dischargeable under section 523. It is important to distinguish
between a denial of the entire discharge under section 727, and a
determination under section 523 that a specific debt is
non-dischargeable. A denial of the entire bankruptcy discharge allows all creditors
to pursue their claims post-bankruptcy; whereas if a discharge is
granted, only those creditors who are owed debts found to be
non-dischargeable under section 523 will be free to collect their claims
post-bankruptcy.
Chapter 7 Means Test
The Chapter 7 means test is a two-step process which begins with a median income comparison. Explaining this first step of the Chapter 7 bankruptcy means test in more detail, your monthly income is compared to the median income in your state for a family that is the same size as yours. If your income is at or below the median income, you qualify for Chapter 7 bankruptcy. If your income is higher than the median income, it doesn’t mean that you can’t file for Chapter 7 bankruptcy, but rather triggers the second step of the Chapter 7 bankruptcy means test.Calculating disposable income and unsecured debts is the second step of the Chapter 7 means test. If your disposable income over the next five years is less than $6,000 ($100/month), you "pass" the Chapter 7 bankruptcy means test and can thus file for Chapter 7. A local bankruptcy attorney can further explain how disposable income is calculated. If your disposable income during that five year period is greater than $6,000 but less than $10,000, you may still be able to file for Chapter 7 bankruptcy protection, depending upon your allowed expenses.
Our Services
If you are facing foreclosures, repossessions, wage garnishments, liens, and constant calls and letters from creditors and collection agencies, we are ready to assist you. The Pacific Bankruptcy Center is a debt relief agency, aiding clients in filing for bankruptcy relief under the Bankruptcy Code. Contact a bankruptcy lawyer at our firm today to learn more through an honest assessment of your situation
Julian, California
Julian is an unincorporated community in San Diego County, California, in the United States. As of the 2000 census, the census-designated place population was 1,621. Julian is an official California Historical Landmark No. 412. Also, the Julian town site and surrounding area is defined by the San Diego County Zoning Ordinance Section 5749 as the Julian Historic District. This designation requires that development adhere to certain guidelines that are administered by the Architectural Review Board of the Julian Historic District, which is appointed by the San Diego County Board of Supervisors
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