Many Americans each year deal will the repercussions of Chapter 7 bankruptcy. Once the reality of having claimed Chapter 7 bankruptcy for business has settled, the next step turns to how to remove Chapter 7 from your credit report. Usually, Chapter 7 bankruptcy will be placed on your credit report once bankruptcy is filed. It can stay on your credit report for up to ten years. At the ten year mark the Chapter 7 will come off your report automatically.
However, there may be a few ways to remove Chapter 7 bankruptcy for business prior to the ten year period. Most individuals have heard or have been told that you can only have Chapter 7 removed once the ten year period has expired. Although, if there is incorrect information in the bankruptcy filing, then a dispute can be filed to correct information. The dispute will be filed with a credit bureau. If the credit bureau finds the dispute to be valid or fails to verify the dispute, then the disputed material has to be removed, which includes any attached bankruptcies. Even though this is an option, if available, it is still difficult to achieve. Thus, most individuals will have to wait the ten year period, when the Chapter 7 Bankruptcy for business is automatically removed.
When Chapter 7 bankruptcy is discharged, an individual is released from personal liability for certain debts and obligations. This discharge is a permanent order that precludes creditors from taking any action against the debtor.
Most times Chapter 7 bankruptcy for business is released automatically after ten years. Once the ten year period has expired, the court will grant the discharge soon after. The clerk of the bankruptcy court will mail a copy of the order of discharge to all creditors. The debtor and the debtor’s attorney also receive copies of the discharge order. Not all debts are automatically released from the debtor. What debts are released is determined by who the debtor is, what debts are involved, and the bankruptcy proceedings involved. The following is a list of debts that are not usually discharged:
Based on the variables in each situation, it is important to seek the assistance of a bankruptcy attorney to determine the best options for you.
There are certain instances where Chapter 7 bankruptcy for business can be denied. Usually, there are specific reasons for such denial. For example, denial of chapter 7 may be for attempt to defraud, lying, removing information, or refusing to cooperate with the court. Denial as shown in the preceding sentence comes because of some bad act or intent by the debtor. If we focus on one of these topics, it will create a clearer picture for why a court would deny chapter 7 bankruptcy for business.
Attempt to defraud comes when an individual is seeking to hide, conceal, or mislead information or property from a creditor. This could occur when a person intentionally hides documents or property before bankruptcy is applied in full force. These rules are really implemented to preclude debtors from giving away their assets before bankruptcy proceedings begin. If they were allowed to partition off assets before a proceeding, then creditors would not be satisfied in full, or even partially.
The takeaway should be that as long as you are not trying to act in a bad manner and hide assets, chapter 7 will not be denied. As a debtor, you need to be able to explain where your assets are located. If there is a sudden disappearance for personal assets, there must be a detailed and important reason for losing assets. The court essentially wants to protect creditors when a debtor claims bankruptcy. That is why there needs to be some accountability for debtor assets. For a court to determine whether there should be a denial for Chapter 7 bankruptcy for business is fact specific. There is not a set formula that the court will look to in determining whether a denial should be made.