Chapter 7 Bankruptcy Attorney in Speedway

Understand What Chapter 7 Could Change Before You File

Chapter 7 can eliminate personal liability for many qualifying debts, but the decision should begin with a clear understanding of what may be discharged, what property may be protected, and whether you qualify.

At Jackson & Oglesby Law LLC, Michael Jackson and Dana Oglesby help people in Speedway evaluate Chapter 7 and other bankruptcy options through a free bankruptcy evaluation. We review income, debts, property, secured obligations, recent financial activity, collection pressure, and financial goals before recommending a filing strategy.

Our attorneys bring more than 30 years of combined bankruptcy experience and regularly represent clients before the United States Bankruptcy Court for the Southern District of Indiana.

What Chapter 7 Bankruptcy Does

Chapter 7 is a liquidation bankruptcy process.

After a case is filed, a Chapter 7 trustee reviews the debtor's financial disclosures, property, exemptions, and other information. If nonexempt assets are available for administration, the trustee may sell those assets and distribute proceeds according to bankruptcy law.

Many individual Chapter 7 cases are no-asset cases, meaning the trustee determines that there are no nonexempt assets available for distribution to unsecured creditors.

That does not mean someone should assume all property is safe before filing. The value of assets, liens, ownership, applicable Indiana exemptions, prior transfers, and other facts must be reviewed first.

Do You Have to Pass a Means Test?

Chapter 7 eligibility can involve the federal means test.

The calculation uses a defined measure of current monthly income and, for many consumer filers, compares it with the applicable Indiana median income for a household of the same size.

Income above the median does not automatically mean Chapter 7 is unavailable. Additional calculations involving expenses and other permitted deductions may determine whether a presumption of abuse arises.

Eligibility can also be affected by prior bankruptcy cases, previous dismissals, and other circumstances.

Before filing, an individual debtor generally must also complete credit counseling through an approved provider within the period required by federal law.

What Debts Can Chapter 7 Discharge?

A Chapter 7 discharge releases an individual debtor from personal liability for qualifying debts.

Common dischargeable debts may include:

• Credit card balances
• Medical bills
• Qualifying personal loans
• Past-due utility obligations
• Other eligible unsecured debts

Not every debt receives the same treatment.

Domestic support obligations generally survive bankruptcy, and tax obligations are subject to separate discharge rules. Student loans and certain other debts also require their own analysis.

A discharge also does not automatically eliminate a valid lien on secured property.

We review individual debts before filing rather than assume that every balance listed on a credit report will disappear.

How the Automatic Stay Can Affect Collection Activity

Filing a bankruptcy petition generally triggers the automatic stay.

The stay can pause many collection actions, including collection lawsuits, creditor demands, and wage garnishments. It may also affect foreclosure or repossession activity depending on timing and the facts of the case.

The protection is not unlimited. Exceptions apply, prior bankruptcy filings can affect the stay, and a creditor may ask the court for relief from the stay in appropriate circumstances.

If collection activity is already underway, we review the timing before explaining how filing may affect it.

Indiana Exemptions & Property in Chapter 7

Indiana has opted out of the federal bankruptcy exemption system available under 11 U.S.C. § 522(d). As a result, an Indiana debtor generally relies on applicable Indiana exemption law and other exemptions available under federal nonbankruptcy law.

Exemptions determine what interests in property may receive protection during the case.

Indiana law provides exemptions involving a personal or family residence, tangible property, certain intangible property, retirement interests, health savings accounts, and other categories.

The exemption amounts applicable to some categories are periodically adjusted. Rather than assume that a particular asset is protected based only on its type, we review:

• Current property value
• Equity after valid liens
• Ownership
• Applicable exemption category
• Whether the case is filed individually or jointly
• Recent transfers or changes in ownership

Our Indiana bankruptcy exemptions page provides additional information about the current exemption framework.

Property concerns do not automatically prevent a Chapter 7 filing, but they should be reviewed before the petition is submitted.