Bankruptcy 7 11 13




The US has a Bankruptcy Code which is a set of laws that protect creditors and debtors. These set of laws are explained in bankruptcy 7 11 13. Although they all deal with bankruptcy, these chapters have different ways of dealing with it. They all have different procedures and they take different approaches to address personal or business bankruptcy.

Chapter 7 bankruptcy involves the liquidation of assets and property in an attempt to clear debts as fast as possible. This type of bankruptcy has a very straight forward approach towards settling the debts that are owed. When the debtor files for this bankruptcy, the exempt property is then handed over to a board of trustees. These trustees then transform them into liquid cash. This process takes a period of four months and then the debtor receives discharge of all dischargeable debts.

Chapter 11 bankruptcy is one that is mostly preferred by businesses. The process is preferred due to its complexity and expense. In this chapter, the business that qualifies for bankruptcy also goes under the management of the trustee board. It is also referred to as a process of reorganization and restructuring of the business. The business is allowed to stay open during the whole procedure.

The process involves the laying down of a repayment plan by the debtor, which must be approved by the creditors involved in the deal. The plan might seek to cancel contacts or even the value of shares if any in the market which will leave the shareholders with nothing. Any plan that is approved by the creditors will be implemented.

Chapter 13 takes a relatively different angle of dealing with bankruptcy. During this process, the debtor does not lose any of their assets. They get an opportunity to repay the debts that they has accumulated during a certain period of time. The debtor must then have a constant source of income that will act as security to paying the amount that is agreed with the creditors over a period of time. This is a good chapter to follow especially when the individual has the desire to pay for the debt but needs protection from the court.

In chapter 13, there are some loans that might be discharged. With the filing of bankruptcy according to this chapter, one should know that there are loans that will continue being paid for. Mortgage and taxes are not discharged and will therefore need to be paid and on-time. The chapter 13 process takes a period of 3 to 5 years to complete, depending on the court ruling. The credit history remains on one’s record for two years after the settlement of the debt.

When an individual is filing under bankruptcy 7 11 13, they should make sure that they seek professional advice to know the best chapter for them to take. While many may fear the process and embarrassment of having the public know they are having to take bankruptcy, this may be their only option to lead them out of the stressful situation they are in.