Chapter 7 bankruptcy is a legal process that allows individuals or businesses to eliminate most of their unsecured debts, such as credit card bills and medical expenses. In this process, a court-appointed trustee sells non-exempt assets to pay creditors. After the liquidation, most remaining debts are discharged, giving the debtor a fresh financial start. To qualify for Chapter 7, individuals must pass a means test, which assesses their income and expenses. Certain assets, like a primary home or retirement accounts, may be exempt from liquidation. This type of bankruptcy typically takes a few months to complete and can significantly impact a person's credit score.