If you already know that there are seven different ways of filing for bankruptcy, then you are probably a lawyer or bankruptcy, or failed once, because very few Americans are aware that there are so many ways, even when we know that most likely could not name of the individual chapters, and will have very little idea of them could be better for them.
There are seven different
Chapter 7 covers liquidation bankruptcy.
Chapter 9 municipal bankruptcy concerns.
Chapter 11, which applies to discharges resulting from the confirmation of the Chapter 11 reorganization plan.
Chapter 12 (A & B), which refers to a family farmer or fisherman cases.
Chapter 13 (A & B), which refers to specific cases involving adjustment of debts of an individual with regular income.
* Two different versions of chapters 12 and 13 there.
This article will consider only Chapter 7, 11, 12 and 13 of the bankruptcy refers to the village, it is unlikely that either need or interest here.
You can not pay your debts!
In essence, the various bankruptcy laws, the manner of a debtor is unable to pay its creditors to resolve his debts through the control of the distribution of some of its assets among its creditors.
The purpose of this division supervision, is to try to ensure that the interests of all creditors are treated with a certain degree of equality.
Some bankruptcy debtor’s residence, business, and use the revenue thus obtained to deal with its debts.
Even if the debtor is or development of a plan or the trustee is gathering the resources available for sale, the Bankruptcy Code provides
a) that creditors must stop all collection efforts against the debtor.
b) If the bankruptcy petition stamped “Relief Ordered” when the debtor is immediately protected from your creditors.
Each chapter, explaining
Chapter 7 bankruptcy
Chapter 7 is the liquidation chapter of the Bankruptcy Code, which is more commonly referred to as “bankruptcy” or “liquidation”, and can lead,
a) Individual
b) Company
c) Partnership
Under Chapter 7 trustee is appointed to collect and sell all property that is exempt and can use all their income to pay creditors. A person who files Chapter 7 is allowed certain exceptions, is known as discharge, meaning that you can keep certain assets, and not have to pay some debts.
Debt relief is generally granted to borrowers, but may be denied or revoked by a court under certain mistakes of borrowers, which could lead to fraud, such as
a) the debtor’s failure to disclose all their assets during bankruptcy.
or,
b) corporations and partnerships do not receive a discharge, which means that individuals who are part of corporations or associations are always responsible for the debts and often file bankruptcy to another, as individuals.
Chapter 11
Chapter 11 is a “reorganization” in which an individual or contractor has proposed a repayment plan for creditors who are owed money before the case is submitted.
Although designed primarily for business, can also be used by people who do not receive or file Chapter 7 or Chapter 13
Reasons for non-qualifying
a) individual income is too high for Chapter 7
b) the amount of debt is too high for Chapter 13
Chapter 12 Bankruptcy
Chapter 12 is designed for those who qualify as family farmers, which means that some of the debtor’s income must come from managing the farm, to be eligible. family farmers to devise a plan to repay creditors over a period of expected future income, and the plan must be approved by the court.
Payments are made through a trustee, chapter 12, which also supervises the agricultural activities of the debtor and the case is ongoing.
Chapter 13 Bankruptcy
Chapter 13 is
a) Individuals who have a regular income whose debts do not exceed $ 1,000,000 ($ 250,000 in unsecured debt and $ 750,000 in secured debts).
b) Persons who operate as sole proprietorships.
Corporations and partnerships do not qualify.
Chapter 13 bankruptcy
a) generally allows people to use a portion of their property, agreeing to repay the creditors of his future income.
b) the debtor to propose a repayment plan, which must then be approved by the court.
c) the amounts which the plan must be paid to the Chapter 13 trustee, which in turn distributes the funds for a small fee.
d) Most of the debt, it is possible that discharge may still be paid for longer.
e) After completion of payments under the plan, Chapter 13 debtors receive a return of almost his debts.
If you have overwhelming debts, and may have tried credit counseling, debt settlement and debt consolidation, but either did not or could not work, and now have debt collectors at your door then bankruptcy may be the best way.
Current financial situation is disastrous, and many people manage their lives and businesses in an effective way for many years now forced into bankruptcy, and the upside is that this failure is more shameful, so to speak.
If bankruptcy appears inevitable, hopefully this article will give you enough information so you can decide what form of bankruptcy might be right for you.
But in any case, I would recommend having a qualified bankruptcy attorney handling the procedure for you, because almost certainly save more money than you cost.
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