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You are here: HOME>GEORGIA BANKRUPTCY LAW QUESTIONS>CHAPTER 7 INFORMATION

Yes, although it is rare if we plan your Chapter 7 properly.  A creditor might object to your Chapter 7 case if you ran up a lot of credit card bills in the six months to a year prior to filing.  Or, your bankruptcy can be challenged if you misrepresented your financial affairs in a personal financial statement.

If a creditor does object, we can usually negotiate a partial payment plan for that particular debt.  You also have the opportunity to convert your case to a  Chapter 13 repayment plan.

Will I have to go to Court for my Chapter 7?

If you file Chapter 7, you will likely need to attend one very brief, informal hearing.  Click to learn exactly what happens at a Chapter 7 meeting of creditors hearing

Will I have to attend credit counseling as part of my Chapter 7?

The bankruptcy law now requires that you attend a credit counseling session prior to filing and a second, budget counseling session, prior to receiving a Chapter 7 discharge. It is expected that most people will fulfill their credit counseling requirements by taking an on-line course.  Consumer Credit Counseling Services of Atlanta, which has been approved as a credit counseling provider by the Office of the United States trustee will charge $50 for each of the two mandatory credit counseling training programs.

How long does it take for me to get my credit restored after Chapter 7?

My experience has been that you will recover and start rebuilding your credit more quickly after Chapter 7 more quickly than you will a Chapter 13. This is true because your Chapter 7 case will be over in 3 to 4 months, after which you can start to rebuild your credit. Chapter 13, by contrast, lasts at least three, and as many as five years and you have to wait until your Chapter 13 is over before you can start to rebuild.

After your case is discharged, I will discuss with you one or more strategies whereby you can rebuild your credit after Chapter 7 bankruptcy.  Often a part of this strategy is to use the provision of the Fair Credit Reporting Act to challenge inaccurate and outdated credit report information so that derogatory entries will be removed.

Clients who have followed my advice about restoring their credit after Chapter 7 report to me that their credit scores usually take about a year to rebound to 600+ and that it may take 8 months to a year until they would qualify for a reasonable car or mortgage loan rate.

Can I Keep My Property if I file Chapter 7?

Generally, the answer is “yes.”  If you own property free and clear, you keep it as long as it is exempt.  The Georgia Code sets out what property you may declare as exempt.  Generally, things like household goods, clothing, personal items, etc. are full exempt.  You can read more about Georgia exemptions here.

Property that is particularly valuable like oil paintings, expensive exercise equipment, coin collections, or one-of-a-kind items may have a value that is more than what can be protected under the exemption rules.  In such a case, you will have to either turn over the property to your trustee or offer to buy the trustee out of his interest in the non-exempt property.

If you have property subject to a lien, your choices are to surrender the collateral back to the secured creditor or you can reaffirm the debt, keep making payments and keep the property. 

Reaffirmation only works when:

1. - your equity in the property falls within the permitted exemption;
2. - you are current or close to current with your loan payments;
3. - the secured creditor agrees to reaffirm
4. - you have enough disposable income in your budget to make the monthly payment

Please click on the highlighted text to learn more about reaffirmation in Chapter 7. 

Generally, most secured creditors are happy to reaffirm as there is rarely much of a market for used furniture or appliances.  In fact, secured creditors who have an interest in collateral like furniture, appliances, electronics or computer equipment are sometimes willing to negotiate a lower payment and/or a lower payoff.  In a recent case, I was able to negotiate a lower balance - a $950 payoff from a $3,518 balance - where the collateral was a home computer.

Car lenders are less likely to agree to a negotiated payoff because there is an active market for used vehicles.  However, if the loan balance on a vehicle is significantly higher than the value of the vehicle, you may have some room to negotiate. .

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