What Are All of the Various Types of Bankruptcy?
There are many types of bankruptcy, including Chapter 7, 11, 12 and 13, with Chapter 7 referring to the individual liquidation bankruptcy in which a debtor turns over their non-exempt assets to a bankruptcy trustee to pay off creditors. Find out what processes are involved in Chapter 11, 12 and 13 bankruptcies with help from a certified civil mediator in this free video on bankruptcy and money management.
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You're having trouble meeting your bills. In fact, your income is not lasting the entire month and you've had people tell you maybe you should consider bankruptcy and you've heard about Chapter 7 and Chapter 13 and Chapter 11 and Chapter 12. And it's all very confusing and gee, what exactly does all of this mean? Hello, I'm Robert Todd, and I'm here to answer the question: What are the various types of bankruptcy? Well, in general terms, the Chapter 7 is the individual liquidation bankruptcy where you, as the debtor, turn over your non-exempt assets to the bankruptcy trustee who converts them to cash and pays off the creditors. And you are discharged from your debts. That's a very basic explanation. Chapter 13 is more of an individual reorganization where you make enough money to come up with a reorganization plan where you're going to pay off your debts and you're going to be able to keep a lot of your assets. And this, too, is a very basic definition. And then there's Chapter 11, which is a corporate reorganization, much like a Chapter 13, but primarily for corporations and partnerships. And then there's Chapter 12, which has to do with debt adjustment for family farmers. And that's a basic overview of the various bankruptcies that are available. If you have a specific question about bankruptcy, we recommend that you consult a bankruptcy attorney. I'm Robert Todd, and thank you for watching.