What does Chapter 7 bankruptcy involve?

A Chapter 7 is known as a liquidation chapter. It's basically a case that lasts three to four months, you get a full discharge of the debts. It is important to accurately and completely disclose your assets because if you leave something off, the court requires everything to be fully disclosed even if it's not worth anything. Say, you have a 401(k) with $100 in it. You need to list it, even though it's fully exempt.

It's important to have an attorney explain some of the different requirements in Chapter 7 because that type of a case cannot be voluntarily dismissed. Once you're in, you're in. There's no getting out. You need to make sure it's done correctly from the beginning.