Chapter 7 Bankruptcy is called a "liquidation" bankruptcy. Chapter 7 bankruptcy is designed to help people who are unable to pay their existing debts. The purpose of filing a Chapter 7 case is to obtain a discharge
of your existing debts. When you file for Chapter 7 bankruptcy you can wipe out debt from:
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- Credit cards
- Personal loans
- Certain tax debts
- Parking tickets
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- Store cards
- Checking account overdrafts
- Medical and dental bills
- Social Security and unemployment overpayments
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In Oregon, a Chapter 7 a trustee takes possession of your property that is not considered "exempt." Common property types that you can keep in Oregon when you file for Chapter 7 bankruptcy are:
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- Bank accounts with a total value of up to $400
- Clothing and jewelry with a value of up to $3,600
- Homes with a total equity of up to $33,000
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- Automobiles with total equity of up to $3,400
- Household furniture with a value of up to $3, 000
- Retirement accounts from a current or previous employer
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In Washington, a Chapter 7 in Washington a trustee takes possession of your property that is not considered "exempt." Common property types that you can keep in Washington when you file for Chapter 7 bankruptcy are:
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- Personal Property of any kind with a value of up to $2000 or, if Debtor does not own a home, up to a value of $9,000.
- Household furniture with a value of up to $2,700
- Retirement accounts from a current or previous employer
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- Automobiles with total equity of up to $2,500 or $5,000 for married couples
- Jewelry with a value of up to $1,000
- Homes with a total equity of up to $40,000
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Unfortunately, not every debt can be wiped out. Debts that are not wiped out include:
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- Most taxes
- Debts obtained through fraud or deception
- Most student loans
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- Child support and alimony
- Court-ordered fines and criminal restitution
- Debts for personal injuries caused by driving while intoxicated or taking
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