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  Chapter 7 is a bankruptcy code that provides relief to people from creditors. Chapter 7 provides a debtor a "fresh start," by releasing debts they owe. Most debts qualify under this code, but there are exceptions. In a Chapter 7 bankruptcy filing, many of the debtor's assets are sold to pay off part or all of the debt.
  
  

How it Works

• To begin the process, a debtor files a petition with a bankruptcy court in the area where the debtor lives. The debtor is required to file an asset and liability form, an income and expenditure form, a statement of financial affairs, and a schedule of contracts and leases. The debtor is also required to submit a copy of his or her most recent tax return and a statement from a credit counseling service showing the debtor has sought its help. All appropriate payments must also be paid, which includes filing fees, administrative fees, and any other relevant fees.
  
  

Filing Jointly or Individually

• Married couples are not required to file Chapter 7 jointly. Married couples are allowed to file jointly, but one spouse may choose to file even if the other does not. If a married person files individually, the spouse's income, assets, and other information are still collected for the court to get an overall picture of the household's financial status. The spouse that did not file is not affected directly by the filing.
  
  

180 day Rule

• There are several rules in filing Chapter 7 dealing with 180 days. A Chapter 7 bankruptcy cannot be filed if, during the prior 180 days, the debtor was involved in a bankruptcy proceeding and didn't follow through with it. For instance, if the debtor failed to show up to any court hearings required or if the debtor failed to comply with any court orders. A debtor must also comply with the rules about seeking help from a credit counseling service. Chapter 7 requires that within 180 days prior to filing Chapter 7, a debtor must have received help and counseling through a credit counseling service.