When people in California find that they are unable to repay the debts that they owe, they most often seek solutions. Thought there are several options for these people, many find the best choice is the filing of a personal Chapter 7 bankruptcy. Such an action can result in the discharge of many, if not all, of the filing individual's unsecured debts.
A Chapter 7 bankruptcy is most often referred to as a total liquidation. In this type of case here in California, the person seeking the bankruptcy must disclose to the court all of their assets and debts. This information is used by the Trustee assigned to the case to determine how much money is available to repay any creditor.
In the recent case, the man told the court that he and his wife owed some $2.1 million to various creditors. Those that they owed included business partners, credit cards and a mortgage on their family home. Some of these debts may be unsecured and subject to a discharge at the time that the bankruptcy process is complete.
A Chapter 7 bankruptcy is not often the first decision for people in California. However, in many cases it is the best choice due to the discharge that occurs at the end of the process. This action allows people to begin a new financial life after the bankruptcy that is free of large amounts of debts. In fact, many find that they are able to obtain credit soon after the process ends. This benefits not only the individual but also the economy of California as a whole.
Source: Star Tribune, Former Minnesota GOP chairman Tony Sutton declares personal bankruptcy, Baird Helgeson, Sept. 9, 2013