This code is generally used by those who lack sufficient income to cover outstanding debts after taking care of basic necessities, and who have no hope of ever repaying their creditors. There are certain obligations that are not dischargeable, for example:

• Alimony and child support

• Back taxes under 3 years old and student loans 

• Recently made purchases for substantial amounts

• Property executed contracts involving titles or liens

Before considering chapter 7 you should take an inventory of the types of debt owed. This will give you a better idea if filing will give you the relief you seek.

Who should consider chapter 7.
* If there is no hope of repaying any of your debts.

* If there are no cosigners involved, 

* If court action by creditors is imminent, filing stays all collection proceeding while in court.

Downsides
Ruins your credit. If you have a cosigner, they will still be responsible for the debt you discharge. Pay attorneys, court and filing fees upfront. 

Alternatives
If you can't discharge enough of your debts or have to sacrifice too much property you may want to consider chapter 13 or a credit counseling / debt consolidation repayment plan.