Does Chapter 7 Bankruptcy Wipe Out All Debt? | Columbus, OH

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Does Chapter 7 Bankruptcy Wipe Out All Debt?

Chapter 7 Bankruptcy Ohio

Are you being held down by debt? Wouldn’t it be nice if there was a restart button, something you could do that would just wipe the slate clean and give you room to breathe financially? Filing for chapter 7 bankruptcy gives you the opportunity to do just that. So, does chapter 7 bankruptcy wipe out all debt? Well, it does and it doesn’t. While it does wipe out most of your unsecured debts, there are some forms of debt that aren’t covered. Keep reading for more information on chapter 7 bankruptcy and what debts you can expect to be forgiven.

What is a Chapter 7 Bankruptcy?

Chapter 7 is in reference to a chapter under the United States bankruptcy code. It is the most common chapter filed in the country. At its core, chapter 7 bankruptcy allows you to lessen your debts through liquidation of your assets and an eventual discharge of your remaining debts. Your remaining debts will typically be forgiven four to six months after you file.

The first step in filing a chapter 7 bankruptcy is getting in touch with a knowledgeable bankruptcy lawyer like the one at Sheppard Law Offices. A bankruptcy lawyer will help you understand your options and make sure you get the fresh start you deserve. 

Once your bankruptcy is filed the first thing you can expect is to take a means test. A means test reviews your income, finances, and total debt to evaluate your expendable income against the state’s median income level. At this time the courts will notify those people you owe and collection activity will cease.

If you meet the requirements in your state this is when you will evaluate your assets.  In most cases, you will not have to sell your assets to pay back what you owe your debtors. There are exemptions that may allow you to keep your vehicle or certain sentimental items like jewelry up to a certain dollar amount.

Assuming that your property will not have to be sold and no money has to be paid to your creditors then all there is to do now is wait. Four to six months after your filing date you can expect the court to discharge the remaining debt. It is important to know that while chapter 7 bankruptcy might cover a lot of debts, it doesn’t cover them all.


  • Medical Bills
  • Credit Card Debt
  • Mortgage & Auto Loans (in most cases, you will not lose possession)
  • Certain Income Tax Debt
  • Personal Loans


  • Child Support
  • Alimony
  • Student Loan Debt, unless an undue hardship is proven
  • Court Fees and Fines

When to File For Chapter 7 Bankruptcy

Chapter 7 of the bankruptcy code was written to give hard-working people like yourself the second chance and fresh start they deserve. Filing Chapter 7 bankruptcy is a big decision and should not be taken lightly but if your debt is severely affecting your mental health, daily life, or ability to sustain you and your family then it might be time to file. Here are just some instances that indicate when to file chapter 7.

Debt collectors can be relentless in their collection practices and this can cause severe stress that has a negative impact on your quality of life. If your debts have overwhelmed you to the point of reducing your quality of life then you should certainly consider a chapter 7 bankruptcy.

Another instance in which you should consider filing is when your debts total more than half of your annual income or your income is lower than the median income of the area in which you live. If you are experiencing either of these two problems then you are not likely to have any disposable income and filing for Chapter 7 Bankruptcy will give you room to breathe again.

If your debts are to the point that it would take several years to pay off even with drastic lifestyle changes and extreme saving measures then you should consider filing a chapter 7 bankruptcy.

It is important to know that every situation is different and that these aren’t the only cases in which a chapter 7 bankruptcy could help. If you aren’t sure whether chapter 7 is right for you, contact your local bankruptcy lawyer and find out.

Bankruptcy Lawyer in Columbus, Ohio

Bankruptcy is no small decision but it’s there to give people just like yourself the help you need to get you through these tough times. If you want the majority of your debt to be wiped clean then filing a Chapter 7 Bankruptcy may be just the move for you. Contact your local bankruptcy lawyer in Columbus today for your free initial consultation and be back on your way to financial freedom!

Sheppard Law Offices


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