Basics of Liquidation
Sometimes, individuals may allow themselves to accrue large amounts of debt and slip into financially unstable situations. When this happens, one method of resolving this situation is for the debtor to file for bankruptcy. One bankruptcy option available to both personal and commercial filers is Chapter 7 (or liquidation) bankruptcy.
If you are considering filing for bankruptcy of any kind, it is important that you consult with an experienced legal professional. Contact the Austin bankruptcy lawyers of Slater, Kennon & Pugh Ltd.LLP today at 512-338-1100.
Liquidation and Chapter 7 Bankruptcy
During the liquidation process, a debtor sells off his or her assets in an effort to obtain the funds necessary to pay off creditors. Chapter 7 may be filed by both personal and commercial debtors, and the processes follow the same steps:
- A trustee is appointed to carry out liquidation transactions
- The trustee carries out a creditor’s meeting, during which he or she learns about the debtor’s financial obligations
- The trustee examines and categorizes the debtor’s assets; non-exempt property is sold
- As much of the debt as possible is paid off with the money gained through the liquidation process
- Unsecured debts that remain are discharged
This process generally takes about six months to complete, and the debtor will likely lose extra homes or vehicles, collections, expensive antiques or heirlooms, and money in bank accounts or investments.
Contact Us
If you would like to learn more about liquidation or Chapter 7 bankruptcy, contact the Austin bankruptcy lawyers of Slater, Kennon & Pugh Ltd.LLP today at 512-338-1100 to speak with an experienced attorney about any questions you may have.