Chapter 7 (liquidation bankruptcy) is the one of the most common types of bankruptcy for individuals (not businesses).
Depending on the state that you are living in, there are various things you will not be forced to sell to complete this bankruptcy, but largely the liquidation of all of your assets and anything you own, of value, will be used by a court-appointed trustee to oversee the sale to be used to pay off your creditors.
Remaining debt that is unsecured, like credit cards and medical bills are typically erased, though unpaid taxes and student loans do not count towards this and are not erased.
• In order to qualify to file for Chapter 7 Bankruptcy, the court must decide that you do not make enough money to be able to pay back your debt based in part on your income versus the state average
• There are no guarantees as to how the bankruptcy will end up, but many people are able to keep necessities, such as their home, their car, and their retirement accounts
• It does not stop a foreclosure of a property, though it can postpone it
• If you have things of value you want to keep but still owe money on is to work out an agreement to reaffirm the debt whereby a loan agreement is reached and you, the debtor, continue to make payments, or resume making them
• When you file, a meeting of your creditors that you owe money to is required for you to attend, and the creditors can proceed to ask prying questions into your financial state
• Chapter 7 bankruptcies will go on your credit report and stay on there for 10 years
• You cannot file a second Chapter 7 until after eight years have passed