Chapter 7 bankruptcy is a type of personal bankruptcy that eliminates most debts and allows an individual to make a fresh financial start. Certain non-exempt assets may be sold off to settle debts with creditors. Chapter 7 bankruptcy puts an immediate stop to creditor harassment, wage garnishment, lawsuits and other collection attempts.

Not everyone qualifies for Chapter 7 bankruptcy. An individual must take a bankruptcy means test to determine if he or she qualifies for Chapter 7 bankruptcy. If it is determined that the individual’s income is too high, or if another factor has led to ineligibility, that individual may still be able to file Chapter 13 bankruptcy.