Chapter 7 Example Case

How a Chapter 7 could work for you


Bankruptcy can RESET your bills to $0.00

BEFORE BANKRUPTCY

Taylor's Bills:

  • $5,000 on credit cards
  • $25,000 in medical bills
  • $6,000 in repossessions
  • $2,000 on phone/cable/internet bills
  • $800 on utilities
  • Wage garnishment

Financial Situation:

  • Taylor has a child and makes $53,000/year
  • Bank account with $1,300
  • Owns a 2008 Pontiac G6 free-and-clear, worth $4,000
  • Purchasing a 2016 Chevy Impala, worth $19,000 and still owes $19,000
  • Owns a house, worth $120,000, and owes $75,000 on the mortgage

AFTER BANKRUPTCY
 

Result of Chapter 7 Bankruptcy:

  • RESET all debt to $0.00 without having to pay creditors
  • KEPT $53,000/yr job
  • KEPT the 2008 Pontiac G6
  • KEPT the $1,300 cash
  • KEPT the house and the 2016 Chevy (as long as Taylor stays current on the payments, and continues to pay moving forward)
  • STOPPED the wage garnishment