Take the First Step towards Freedom
Our bankruptcy attorneys, Phillip Shell and Tonya Whipple, provide comprehensive bankruptcy representation for clients statewide throughout Utah. They offer appointments during normal business hours (8:30 a.m. - 5:30 p.m.) and  may also be available for evening and weekend appointments upon request. Our office is conveniently located near the Murray Central Trax Station. 
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Chapter 7 Bankruptcy: Know Your Options

Representing clients in financial distress

Mounting financial obligations do not have to follow you the rest of your life. Bankruptcy laws offer protection for honest debtors who can no longer make ends meet, regardless of the reasons for your financial problems.

Founded in 1944, Day Shell & Liljenquist, L.C. is a widely respected law firm whose attorneys have extensive knowledge of bankruptcy law. In an initial consultation, we explain the details of bankruptcy law and tell you what to expect at each step. We take the time and have the experience to help you. Come to us and lay your burdens down. We'll take care of them and take care of them the right way.

What is Chapter 7 bankruptcy?

Chapter 7 bankruptcy provides an avenue of relief from most debts and is available to both consumers and businesses. You have the option of surrendering property held as collateral for your debts. But you can elect to keep the property so long as you can make the payments. This is known as reaffirming the debt. People commonly reaffirm debt on homes and cars so they can keep those items after bankruptcy.

Chapter 7 is sometimes called the liquidation chapter, which is somewhat misleading because the law does not require you to liquidate your property. Chapter 7 is also known as the walk-away chapter. If your financial circumstances are dire, you may be able to walk away from all but a few types of debt, such as back taxes, child and spousal support obligations, and student loan debt.

How can I qualify for Chapter 7?

One of the most common bankruptcy questions we hear is how does one qualify to file under Chapter 7. The first test we perform is known as the liquidation test, which involves determining approximately how much money would be left if you sold everything you own, paid off secured creditors, and withheld a small amount of exempt property for yourself. In other words, how much cash could you generate by liquidating your property? If the answer is close to zero, then you pass the first test for filing a Chapter 7 bankruptcy.

The second test, known as the means test, involves comparing your income to expenses. Most living expenses are predetermined according to Internal Revenue Service national standards, but exceptions can allow you to claim more expenses than usual. Debt payments you plan to reaffirm and family support obligations can be included in your expenses. If your expenses are reasonable but you have very little money left at the end of the month, then you probably can pass the second hurdle for filing under Chapter 7.

Our qualified bankruptcy attorneys can quickly determine if you qualify to file a Chapter 7 or Chapter 13 bankruptcy by asking you a few basic questions, including:

  • How much money you make at your job
  • How often you get paid
  • Whether you have any other sources of income
  • Your estimated monthly expenses
  • The estimated value of your home
  • The mortgage on your home
  • The approximate value of your vehicles
  • The approximate debt owed on your vehicles
  • The value of your non-retirement bank accounts and investment accounts