Texas Chapter 7 Bankruptcy: What Individuals Should Consider

2007-03-08 10:33:40

( Legal )



A Texas chapter 7 bankruptcy gets rid most of your debts, allowing you to start over with a clean slate. Also known as liquidation, a Texas chapter 7 bankruptcy requires you to continue paying for alimony, child support and majority of student loans. High end goods bought and cash advances obtained within a certain amount and within a specific period from filing bankruptcy are not exempted. Debts that were obtained through fraudulent means still remain your responsibility.

A Texas chapter 7 bankruptcy can be filed by individuals irrespective of civil status; however, certain requirements must be met prior to filing a chapter 7 bankruptcy in Texas. Individuals must meet a certain income level after certain expenses are deducted. The income level that is considered is based on the individuals’ biannual income. Any delinquent tax returns must be filed and settled before you can file a chapter 7 bankruptcy. You need to attend a credit counseling session before you file a chapter 7 bankruptcy and a debt education seminar after the filing proceedings. A debt education seminar teaches you to manage your finances, so to avoid future chapter 7 bankruptcy filings. Debt education courses and credit counseling sessions must be attended in a place approved by the court or a trustee.

In order to file a chapter 7 bankruptcy in Texas, you must be residing in Texas for a certain amount of time, or the bankruptcy laws in the last state where you resided will apply in your bankruptcy case.

To file a chapter 7 bankruptcy, you will need to submit a petition, and a complete list of debts to the bankruptcy court. A complete list of creditors with contact details must also be included. All secured, unsecured and priority debts must be accurately enumerated. Any debts that are excluded in the list will not be discharged. You also need to provide the court a complete list of all your assets including all forms of property you own. You must ensure that no assets are omitted, as this can result in charges of bankruptcy fraud.

With a Texas chapter 7 bankruptcy, you are allowed to keep certain property from being sold or liquidated by the court. Based on the Texas federal exemption statutes, you can keep your home (some restrictions apply) and a certain amount of personal property. You may also keep any health aids, burial plots and farming or ranching vehicles. The court will not take away any money earned from proceeds of life insurance and certain government benefits.

If you have a previous history of filing a Texas chapter 7 bankruptcy, you will not be allowed to file another chapter 7 bankruptcy until after a certain time period. You can get more information on this and any other facts from a bankruptcy lawyer.


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