Chapter 7 is the fastest path to debt relief. Most unsecured debts are eliminated in 3-4 months. Here is what Kansas City residents need to know.
Chapter 7, sometimes called "liquidation bankruptcy" or a "fresh start," eliminates most unsecured debts. A court-appointed trustee reviews your assets. If you have non-exempt property, the trustee may sell it to pay creditors - but most Chapter 7 cases are "no-asset" cases where the filer keeps everything.
In Kansas City, the vast majority of Chapter 7 filers keep all their property because it falls within Missouri or Kansas exemption limits.
To file Chapter 7, you must pass the means test. This compares your household income to the state median:
The median income figures are updated periodically. For a single filer in Missouri, the current median is approximately $55,000/year. For Kansas, it is approximately $57,000/year. These figures increase with household size.
Exemptions determine what property you keep. Missouri uses its own exemption system (you cannot use federal exemptions).
| Property | Missouri Exemption |
|---|---|
| Homestead | $15,000 equity |
| Vehicle | $3,000 |
| Household goods | $3,000 total |
| Clothing | $1,500 |
| Wildcard | $600 + up to $1,250 unused homestead |
| Tools of trade | $3,000 |
| Retirement (IRA/401k) | Fully exempt |
| Public benefits | Fully exempt |
Kansas exemptions are significantly more generous, particularly the unlimited homestead exemption. Full exemption comparison.
Chapter 7 discharges most unsecured debts including credit cards, medical bills, personal loans, and old utility bills. It does not discharge student loans (in most cases), recent taxes, child support, alimony, or debts incurred through fraud. See section 523(a) for the full list.
The means test compares your household income to the Missouri or Kansas median. If your income is below the median for your household size, you automatically qualify. If above, a more detailed calculation determines whether you have enough disposable income to fund a Chapter 13 plan instead.
From filing to discharge, Chapter 7 typically takes 3-4 months. The 341 meeting of creditors occurs about 30 days after filing, and the discharge is usually entered about 60 days after that.
Missouri exemptions protect: homestead equity up to $15,000, one vehicle up to $3,000, household goods up to $3,000, clothing up to $1,500, a wildcard exemption of $600 plus up to $1,250 of unused homestead, tools of trade up to $3,000, and certain retirement accounts. Full exemption details.
Use the free 1328(f) screener to check whether a prior discharge affects your eligibility.
Free Discharge ScreenerRelated Kansas City Bankruptcy Resources
Our research was cited by the federal judiciary as Suggestions 26-BK-3 and 26-BK-5
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