What is the procedure involved in a Chapter 7 proceeding?
A petition under Chapter 7 is filed with the Court which results in an automatic Restraining Order being entered to prevent action being taken against you or your property by your creditors. A Trustee is appointed by the Court to review the petition and to meet with you and your lawyer in order to determine if you own any assets besides what you are entitled to exempt and retain. If you have assets valued at more than what you can exempt, then the Trustee will sell that property and distribute the proceeds to your creditors. Usually about six months after the petition is filed, the Court will enter an Order discharging or canceling your debts that terminates your legal obligation to your creditors. There are however, some exceptions to discharge.
