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The basic idea in Chapter 7 bankruptcy is to wipe out one's debt. It does not involve the filing of a plan of repayment. There is no property which is non exempt that one can sell to pay creditors; all unsecured creditors are paid nothing. On October 17, 2005, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 make it difficult for one to file Chapter 7 Bankruptcy. One may not file bankruptcy under Chapter 7 if they are capable of paying their creditors based on new criteria known as the means test. The means test compares one's excess monthly income and their amount of debt to determine how much they can pay their creditors...
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