Chapter 7 bankruptcy which is also known as consumer bankruptcy, is designed for individuals, couples who are married, and small business owners, that wish to make a fresh start, however they are extremely unable to pay any debt from their current income (Weltman & Moskowitz LLP, 2011). Partnerships, corporations, LLCs may also file Chapter 7 bankruptcy— those debtors do not receive discharges and they are unable to protect any personal property through federal or state exemptions statutes (Weltman & Moskowitz LLP, 2011). There are many reasons that people would file for bankruptcy. One of the reasons that most people file for bankruptcy is because they are unable to pay their bills—they may have incurred way too much credit card debt (Murphy, 2011). Another reason is because they have incurred hefty medical bills, and have lost work due to illness, either long term or short term (Murphy, 2011). Many may buy a house that they cannot afford and eventually are unable to continue the payments (Murphy, 2011).
This is the end of the preview. Sign up
access the rest of the document.