CCC CCC Bankruptcy & Credit Recovery 1

Question 1

Under U.S. bankruptcy law, which chapter allows individuals to eliminate most unsecured debts through a liquidation process?

Accepted Answer

Chapter 7

Answer

Chapter 7 bankruptcy is a liquidation process that allows eligible individuals to discharge most unsecured debts after a means test.

Question 2

What is the primary purpose of the credit counseling requirement under the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) of 2005?

Accepted Answer

To ensure debtors receive counseling about alternatives to bankruptcy within 180 days before filing

Answer

BAPCPA requires debtors to complete credit counseling from an approved agency within 180 days before filing for bankruptcy.

Question 3

Which type of debt CANNOT typically be discharged in a Chapter 7 bankruptcy?

Accepted Answer

Federal student loans

Answer

Federal student loans are generally non-dischargeable in bankruptcy unless the debtor can prove undue hardship under the Brunner test.

Question 4

In a Chapter 13 bankruptcy, what is the typical repayment plan duration?

Accepted Answer

3 to 5 years

Answer

Chapter 13 repayment plans must last 3 years for below-median-income debtors and up to 5 years for above-median-income debtors.

Question 5

What is an 'automatic stay' in the context of bankruptcy?

Accepted Answer

An immediate injunction that halts most collection actions against the debtor upon filing

Answer

The automatic stay is a powerful injunction triggered automatically upon filing that stops most creditor collection efforts, lawsuits, and garnishments.

CCC Practice Test

CCC Practice Test

CCC CCC Bankruptcy & Credit Recovery 1