Frequency of Denial While some Chapter 7 bankruptcy cases are expelled from court before being discharged, statistics indicate that this is not the norm. The court website, when Chapter 7 cases are filed correctly, result in successful debt forgiveness more than 99 percent of the time. The rejection or denial of a Chapter 7 bankruptcy case is highly unusual, but there are reasons why a Chapter 7 bankruptcy case may be denied. Many refusals are due to a lawyer's lack of attention to detail, errors made in petitions, or fraud itself.
A forgiveness exempts individual debtors from personal liability for most debts and prevents creditors owed to those debts from taking collection measures against the debtor. Because a Chapter 7 waiver is subject to many exceptions, debtors should consult competent legal counsel before filing the application to discuss the extent of the forgiveness. In general, excluding cases that are dismissed or converted, individual debtors receive forgiveness in more than 99 percent of chapter 7 cases. In most cases, unless an interested party files a complaint opposing forgiveness or a motion to extend the deadline for filing objections, the bankruptcy court will issue a waiver order relatively soon in the case, usually 60 to 90 days after the date first set for the creditors' meeting.
Once you have already filed for Chapter 7 bankruptcy, the bankruptcy court will deny a waiver in a later Chapter 7 case if you already received a waiver in your previous Chapter 7 case, or Chapter 11 if you filed within the past eight years. In simple terms, you can get a Chapter 7 bankruptcy waiver every eight years. The eight-year period begins to run from the date your previous case was filed. Unfortunately, there are cases where bankruptcy doesn't go as planned.
The court has the authority to deny a bankruptcy application and, for many people, what seemed to be the best way to control their situation becomes an even bigger nightmare. This publication will review what you need to know about the dismissals of chapters 7 and 11, the previous bankruptcy settlements of chapters 12 and 13, what happens when your annulment is revoked and when you will need a qualified bankruptcy lawyer. Subject to the remedies test described above for individual debtors, compensation is available under Chapter 7 regardless of the amount of the debtor's debts or whether the debtor is solvent or insolvent. The Bankruptcy Code requires the trustee to ask the debtor questions at the creditor meeting to ensure that the debtor is aware of the potential consequences of seeking forgiveness in the event of bankruptcy, such as the effect on credit history, the possibility of filing a petition under a different chapter, the effect of receiving a forgiveness and the effect of reaffirming a debt.
As long as you qualify for the bankruptcy chapter under which you file your return, most consumer bankruptcies filed with the help of an attorney are canceled and you will pay cents on the dollar for your debt. However, a person cannot file an application under chapter 7 or any other chapter if a previous bankruptcy petition was dismissed during the previous 180 days because the debtor deliberately failed to appear in court or did not comply with court orders, or if the debtor voluntarily dismissed the case Earlier later creditors applied to the bankruptcy court for assistance in recovering the assets on which they were encumbered. Erik Clark is one of Southern California's leading bankruptcy attorneys and has had the privilege of representing thousands of clients in chapter 7 and 13 bankruptcy cases in the Los Angeles area. .