What Does a Chapter 7 Statement of Intention Mean?

By Kevin Owen

Unlike Chapter 13 bankruptcy where you repay most of your debts to your creditors, most debts are forgiven under a Chapter 7 bankruptcy after some of your assets are seized and sold. For the court to determine which assets are to be liquidated, you must submit a Statement of Intention that explains how you propose to maintain or dispose of your property.

Statement of Intention

After filing your petition for bankruptcy with the court, you must submit a form called an Individual Debtor's Statement of Intention. You must identify all debts that are secured by property that you own and the name of the creditor holding the secured debt. The form also requires that you indicate whether you intend to retain ownership of the property or surrender the property to be sold by a court appointed trustee for the benefit of your lenders. You also must state whether you are renting property under a current lease and whether you intend to give up the rented property or continue with the rental agreement.

Secured Debts

The Statement of Intention only requires that you disclose property that is used as collateral securing a debt and not any other property. The most common secured debts are your home and your vehicle. Your home is secured by a mortgage and your car is secured by a title. Secured property would be subject to foreclosure and repossession if you were delinquent on payments and not otherwise covered by bankruptcy protection.

Get a free, confidential bankruptcy evaluation. Learn More

Disposition of Property

On the Statement of Intention you must indicate your proposed disposition of the secured property. You may choose to surrender the property to the trustee to sell at auction. In the alternative, you may attempt to keep the property by claiming it as exempt under state and federal laws from seizure by the court -- such as clothing and wedding rings. You also have the option of redeeming the property by paying the outstanding balance owed on the debt or by reaffirming the debt owed to the lender. If you reaffirm the debt you are committing to repay the loan even though you filed for bankruptcy protection.


You must file the Statement of Intention within 30 days after the petition for bankruptcy is filed with the court or by the date set for the first meeting with the creditors, whichever happens first. The bankruptcy judge may allow an extension of this deadline if you make a written request and show there are compelling reasons for more time. After you file your Statement of Intention, you have 45 days to surrender, pay off or reaffirm your secured debts. If you fail to meet these deadlines, the court could seize the secured property and sell it at auction.

Get a free, confidential bankruptcy evaluation. Learn More
Can I Convert to a Chapter 7 Without Losing My House or Car?



Related articles

Schedule F Bankruptcy Discharge

Bankruptcy means a fresh start – a court order protects you from collections and lawsuits, and eventually, the court discharges (cancels) some of your debts. You must report your assets and liabilities, and you will be required to sell your non-exempt property to repay creditors (in Chapter 7) or set up a repayment schedule (in Chapter 13). As your bankruptcy case begins, you'll complete a Schedule F, and it's vital to know the difference between a secured and unsecured debt when preparing this form.

What Happens If I Don't Pay My Chapter 7 Overages?

Under Chapter 7 bankruptcy, your assets are valued by a court-appointed trustee and sold to pay your creditors. You are able to shield property from sale by invoking legal exemptions to protect personal property, a limited amount of real estate and motor vehicles up to a certain value. If the value of your assets exceeds your eligible exemptions, you must address these overages through your bankruptcy proceedings if you want to keep the property.

How Long Is an Automatic Stay After a Chapter 13 Dismissal?

Filing for Chapter 13 bankruptcy creates a repayment plan that allows you to catch up on debt by making monthly payments over three to five years to a Chapter 13 bankruptcy trustee. However, your Chapter 13 bankruptcy case may be dismissed before you complete your repayment plan for several reasons, including if you fail to make your monthly payments to your Chapter 13 bankruptcy trustee or if you miss a required court appearance. The dismissal of your bankruptcy case has several consequences -- including the loss of the protection of the automatic stay.

Related articles

What Happens When You Reaffirm a Vehicle After Bankruptcy?

Bankruptcy allows you to get a fresh start financially, clearing up debts by paying some and dismissing others. Filing ...

How to File for Bankruptcy After a House Is Sold at a Sheriff's Sale

Losing your home to foreclosure through a sheriff's sale may not end your financial difficulties with your mortgage ...

Trustee Objection to Schedule C Exemptions

When you file for bankruptcy, Schedule C is the part of the paperwork that helps provide you with a fresh start. It ...

What Happens if the Signed Reaffirmation Agreement Was Not Filed During the Bankruptcy Procedures?

Bankruptcy gives you a temporary shelter from creditors, as well as collection calls, judgments and lawsuits. In a ...

Browse by category
Ready to Begin? GET STARTED