Chapter 7 bankruptcy provides for liquidation—the sale of the debtor’s nonexempt property and the distribution of the proceeds to creditors. A chapter 7 bankruptcy case does not involve the filing of a plan of repayment as in Chapter 13.

Instead, the bankruptcy trustee gathers and sells the debtor's nonexempt assets and uses the proceeds of such assets to pay holders of claims (creditors) in accordance with the provisions of the Bankruptcy Code. Part of the debtor's property may be subject to liens and mortgages that pledge the property to other creditors.

In addition, the Bankruptcy Code will allow the debtor to keep certain exempt property—but a trustee will liquidate the debtor's remaining assets—and potential debtors should realize that the filing of a petition under Chapter 7 may result in the loss of property.

In Wyoming, as in all states, Chapter 7 bankruptcy is governed by federal law, specifically the Bankruptcy Code. Chapter 7 is designed to provide relief to debtors by liquidating their nonexempt assets to pay off creditors. When a debtor files for Chapter 7 bankruptcy, they are not required to submit a repayment plan as they would in a Chapter 13 bankruptcy. Instead, a bankruptcy trustee is appointed to sell the debtor's nonexempt property and distribute the proceeds to the creditors. Certain property of the debtor may be exempt from liquidation under both federal and Wyoming-specific exemptions, allowing the debtor to retain those assets. However, assets with liens or mortgages may still be subject to seizure by secured creditors. Debtors considering Chapter 7 should be aware that it can lead to the loss of property, as nonexempt assets will be sold to satisfy debts. It's important for individuals to consult with an attorney to understand how Wyoming's exemption laws apply to their specific situation and to navigate the complexities of the bankruptcy process.