Chapter 7 Bankruptcy

Definition

A type of personal bankruptcy that allows individuals to have most of their debts wiped out (discharged) in exchange for giving up non-exempt property to a trustee who sells it to pay creditors. It is often called 'liquidation' bankruptcy and is intended to give debtors a fresh financial start.

Examples

• •Keathley filed a Chapter 7 case, which was still pending when he was injured and became relevant to whether his injury lawsuit was part of the estate.

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