A chapter only refers to the specific section of the United States Bankruptcy Code where the law is located, but we'll look at each type to familiarize you with the options. When you can't get out of debt without adversely affecting your livelihood, bankruptcy could be a consideration. Chapter 7 and Chapter 13 bankruptcies are the most commonly filed types of bankruptcy, probably because they are available to individuals. Chapter 7, also known as liquidation, allows individuals or companies to assign non-exempt assets and pay off most debts.
To qualify, debtors must pass the resource test, meaning their income must be lower than their state's average income. Not all debts can be canceled and forgiveness is not automatic in the case of Chapter 7 bankruptcy. People who successfully settle an eligible debt are no longer responsible for the debt. Bankruptcy Basics provides general information about federal bankruptcy laws and the bankruptcy process.
It is not a guide to filing a bankruptcy case. Bankruptcy Basics provides basic information to debtors, creditors, court staff, the media and the general public on different aspects of federal bankruptcy law. It also provides people who may be considering filing a bankruptcy petition with a basic explanation of the different chapters in which a bankruptcy case can be filed and answers to some of the most frequently asked questions about the bankruptcy process. Find information about bankruptcy laws, including answers to some of the most frequently asked questions.
These videos will provide you with basic information about the process, the relief it offers, and how to find the legal help you may need. Unlike other types of bankruptcy, Chapter 9 bankruptcy does not involve the liquidation or distribution of assets among creditors. Personal bankruptcies can also be filed under Chapter 11 of the Bankruptcy Code, but that's quite rare. The Chapter 9 bankruptcy proceeding filed by the City of Detroit remains the largest municipal debt bankruptcy filing to date.
Leave Message