Chapter 7 (United States)

Chapter 7 bankruptcy, often called "liquidation" or "straight bankruptcy," allows individuals to eliminate most unsecured debts, such as credit cards or medical bills. A court-appointed trustee reviews your assets and may sell non-exempt property to pay creditors. Many debtors can keep essential belongings like furniture and a vehicle, depending on state laws. Once the process concludes, remaining eligible debts are discharged, giving a fresh financial start. However, not all debts are dischargeable, and certain circumstances or assets can limit benefits. It’s typically quicker and more straightforward than other bankruptcy types, providing relief from overwhelming debt.