Understanding Chapter 7 Bankruptcy

If you are in Ohio and are contemplating about filing a bankruptcy under chapter 7, you need to understand some of the statutes under this chapter. In essence, a Chapter 7 bankruptcy is known as liquidation wherein as a debtor, you will be able to pay off all your debts by selling all your assets and dividing its proceeds according to the number of creditors. A court appointed trustee will be selected by the bankruptcy court that will serve as the administrator of all your assets up until it is converted into cash and repay all your financial obligations. They will also have the major responsibility of monitoring the bankruptcy cases and supervising all activities between a debtor and his creditor.
If you receive a bankruptcy discharged, it means that the creditors are no longer legally allowed to collect the debts you accumulated and you are no longer compelled to pay back all your discharged debts once your bankruptcy case is over. However, not all debts are dischargeable. A creditor can object to the discharge of your debts if they have the reason to believe that a fraud was committed in connection with the filing of bankruptcy of the debtor. Also, there are debts that cannot be discharged such as payday loans or cash advances with a total of more than $925 obtained within seventy days prior to the filing of bankruptcy and purchase of luxury goods using credit cards among others.
Except in cases where the person in debt can prove remarkable conditions to bypass public policy, the following financial obligations are regarded as automatically nondischargeable:


  • Unscheduled
  • Debts for child support or alimony
  • Arrears to government agencies
  • Student loans with a few exceptions
  • Financial liabilities for personal injury obtained by the debtor while operating a motorized vehicle while intoxicated
  • Criminal restitution including court penalties and related fines


As discussed with your bankruptcy attorney, before an individual can file for Chapter 7 Bankruptcy, he or she is required by the law to meet the minimum amount of unsecured debt loads and must not exceed the amount of secured debts required by law. During filing, applicants are also required by Chapter 7 bankruptcy code to furnish a comprehensive proposal of repayment scheme and this can be done with the help of an experienced bankruptcy lawyer which has years of experience when it comes to performing his duties focusing on Chapter 7 bankruptcy. The debtor is also allowed to continue operating his business during the stage of Chapter 7 and this allows the debtor to engage in trading and selling even without the permission of the court which under any circumstance, cannot be done without the code of Chapter 7 that will be filed with the help of your bankruptcy attorney.
This blog discusses the Chapter 7 bankruptcy as well as specific debts that are considered dischargeable and not dischargeable.


Attorney Eli Tamkin is a Cleveland bankruptcy lawyer.  He has been practicing law since 1989 and in Cleveland Ohio since 1994. Since then, he has dealt with a variety of legal issues, including bankruptcy, real estate, divorce, personal injury, and probate. Many times, answering questions on bankruptcy draws on knowledge of other legal areas as well. His experience in these other areas, as well as in bankruptcy enables him to address your particular needs and to offer you advice that is applicable to your situation.


  1. […] Generally, yes you may if your loan is modified in mediation; but you should consult an attorney about your particular situation.  In many instances the bank will approve a loan modification even though you have already discharged your debts, including your mortgage note, in a bankruptcy; however, as will be discussed next, you will nevertheless be liable for that note if you sign a reaffirmation agreement with the bank during your Chapter 7 Bankruptcy. […]

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