How does Chapter 7 work?
In a chapter 7 bankruptcy, debtors give up certain property that they own at the time they file the bankruptcy case. This property is sold by a trustee, who uses the proceeds to pay creditors. The debtors receive their discharge shortly after the case is filed. In this way, chapter 7 debtors are allowed to keep the money that they earn after filing the bankruptcy case, as well as most other property that they obtain after the filing.
