Getting rid of debt is a formidable challenge, especially if you owe hundreds of thousands of dollars to an array of creditors. Sometimes the only way to get out of the nightmare that is debt, you need to file chapter 7 bankruptcy in your local court system. Understanding how to do it and what it does is crucial for getting your problems to reserve themselves instead of worsening.

Unlike other types of bankruptcy chapter, Chapter 7 is geared towards individuals and focuses on assets rather than income. A more traditional filing, such as Chapter 13, will combine the debt you owe to different creditors into one single entity than can be slowly resolved through payment plans that are supervised by a court-appointed individual. Chapter 7, on the other hand, sizes up the value of your personal assets, such as your house, belongings and vehicle, and will begin selling those items for cash that is, in turn, given to your creditors.

If you are not a homeowner nor have much property to your name, Chapter 7 may benefit you more than Chapter 13. That’s because the court may rule that you do not have a sufficient amount of assets to pay back your creditors, and your case can be discharged completely. New laws have been enacted within the last decade that made intricate changes to the criteria for a discharge, so hiring a lawyer that understands the laws will help you to pursue the best course of action given your circumstances.