By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
The News GodThe News God
  • Politics
  • News
  • Business & Finance
  • Lifestyle & Health
  • Law
  • Sports
  • Tech & Autos
  • Home & Garden
  • More
    • Travel & Tour
    • Education
    • Entertainment
    • General
Reading: A Simple Guide on the Different Types of Bankruptcy
Share
Aa
The News GodThe News God
Aa
  • Politics
  • News
  • Business & Finance
  • Lifestyle & Health
  • Law
  • Sports
  • Tech & Autos
  • Home & Garden
  • More
Search
  • Politics
  • News
  • Business & Finance
  • Lifestyle & Health
  • Law
  • Sports
  • Tech & Autos
  • Home & Garden
  • More
    • Travel & Tour
    • Education
    • Entertainment
    • General
Follow US
  • Why You Need to Read Business News Everyday
  • Why You Need to Read Business News Everyday
  • Advertise
  • Advertise
The News God > Blog > General > A Simple Guide on the Different Types of Bankruptcy
General

A Simple Guide on the Different Types of Bankruptcy

Rose Tillerson
Last updated: 2021/07/16 at 10:59 AM
Rose Tillerson  - Editor Published July 16, 2021
Share
4 Min Read
SHARE

Are you drowning in debt and unable to pay your creditors? Maybe you lost your job, lost a relative, are dealing with a medical emergency, or recently got divorced.

Contents
What Is Bankruptcy?6 Types of Bankruptcy1. Chapter 7: Liquidation2. Chapter 13: Repayment Plan3. Chapter 11: Reorganization4. Chapter 12: Family Farmers5. Chapter 15: Foreign Cases6. Chapter 9: MunicipalitiesFile Bankruptcy

Whatever the reason, it has become extremely difficult for you to keep up with your bills and you have run out of solutions and options.

Before you consider filing bankruptcy it’s important that you understand the various types of bankruptcy and what they entail.

What Is Bankruptcy?

Bankruptcy is a way for people to eliminate debt they are unable to pay by either establishing a repayment plan or liquidating assets. All cases are handled in bankruptcy court for which debtors are required to pay fees.

It’s important to know that there are 19 types of debts that do not qualify for discharge. However, debts that do qualify for discharge are no longer the responsibility of the debtor. Additionally, creditors must stop attempting to collect the debt.

Although declaring bankruptcy is a way to start over, there are long-term consequences on your credit. Because bankruptcies appear on your credit for 7-10 years, creditors are less likely to approve you for loans or credit cards.

6 Types of Bankruptcy

Individuals, businesses, cities, school districts, and so on can choose from 6 different bankruptcies to file. Deciding which one to file depends on the type of debt and the financial situation.

Ultimately, the court and sometimes the creditor create a plan for the debtor.

1. Chapter 7: Liquidation

This is the most common bankruptcy for individuals and requires liquidation. Basically, if your income is too low to pay your debt, the court will require you to sell anything with value to pay your creditors back.

Depending on what state you live in, you may have to sell your house, vehicle, and even retirement accounts.

2. Chapter 13: Repayment Plan

This type of bankruptcy is for individuals and small business owners. The court decides on a monthly repayment plan and you pay your debt within 3-5 years. However, there is a secured and unsecured debt threshold to qualify.

Chapter 13 also gives you the option to stop a foreclosure. For more information or help filing, consult a Chapter 13 Bankruptcy Attorney.

3. Chapter 11: Reorganization

This kind of bankruptcy helps businesses and corporations repay their debt by establishing a plan. It also includes a plan on how they will reorganize and manage the business. Everything is approved by the court and creditor.

4. Chapter 12: Family Farmers

Chapter 12 is similar to Chapter 13 but offers more flexibility for fishermen and family farmers to repay debt under a plan.

5. Chapter 15: Foreign Cases

Chapter 15 allows certain debtors outside of the U.S. to file bankruptcy in the U.S.

6. Chapter 9: Municipalities

This type of proceeding helps municipalities such as cities, school districts, counties, etc. to create a repayment plan to pay off their debt.

File Bankruptcy

Are you ready to file and take care of your debt? Check out this resource for bankruptcy forms, local offices, and contact information.

If you found this article helpful, be sure to read more from our Business & Finance section!

You Might Also Like

Why Hampers Make Great Gifts

Tuck Top Mailer Boxes: The Game-Changer in Custom Packaging

The Science Behind Camouflage: How It Helps You Blend in While Hunting

Navigating Dublin’s Tailoring Scene: A Guide to Finding the Perfect Tailor

Defiant Zelensky declares Bakhmut ‘not occupied’ by Russia amidst the Ukraine war.

Rose Tillerson July 16, 2021
Share This Article
Facebook Twitter Email Print
Share
Previous Article What Causes Low Testosterone in Men?
Next Article Can the Mediterranean Diet Stop Alzheimer’s?
Leave a comment Leave a comment

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Stay Connected

235.3k Followers Like
69.1k Followers Follow
11.6k Followers Pin
56.4k Followers Follow
136k Subscribers Subscribe

Ads

Latest News

10 Things to Consider Before Getting a Forward Helix Piercing
10 Things to Consider Before Getting a Forward Helix Piercing
Lifestyle & Health June 3, 2023
How To Travel From Hue To Hoi An? - Top 6 best ways for you
How To Have A Great Time In Arizona?
Travel & Tour June 3, 2023
Why Hampers Make Great Gifts
Why Hampers Make Great Gifts
General June 3, 2023
Behind the Scenes: The Valuable Role of Law Enforcement Consultants
Behind the Scenes: The Valuable Role of Law Enforcement Consultants
Law June 3, 2023

You Might also Like

Why Hampers Make Great Gifts
General

Why Hampers Make Great Gifts

June 3, 2023
Tuck Top Mailer Boxes: The Game-Changer in Custom Packaging
General

Tuck Top Mailer Boxes: The Game-Changer in Custom Packaging

June 2, 2023
The Science Behind Camouflage: How It Helps You Blend in While Hunting
General

The Science Behind Camouflage: How It Helps You Blend in While Hunting

May 24, 2023
Navigating Dublin's Tailoring Scene: A Guide to Finding the Perfect Tailor
General

Navigating Dublin’s Tailoring Scene: A Guide to Finding the Perfect Tailor

May 24, 2023
Show More
© 2022 Thenewsgod. All Rights Reserved.
  • About
  • Contact Us
  • Terms of Use & Privacy Policy
  • Advertise
  • Disclaimer
Welcome Back!

Sign in to your account

Lost your password?