Services
Chapter 7 Bankruptcy
Chapter 7 is the most common of all the bankruptcy and is typically used by an individual that owns property, has a small business or lives in the United States. In this form of bankruptcy, the lawyer makes arrangements for the sale of all property and items of value to exchange them for cash to pay off as many outstanding debits as possible. This gives the individual a fresh start, however, a chapter 7 bankruptcy will stay on the individual's credit report for up to 10 years. This may hurt an individual's chance of obtaining credit again at other places, certainly at any of the places he or she did business with when they filed for bankruptcy, but there are a few places that will give them a break and allow them to rebuild their credit.
Chapter 11 Bankruptcy
Chapter 11 is used by businesses if they cannot pay their debts. Many businesses use Chapter 11 bankruptcy when they are going to reconstruct and reorganize their debit. While Chapter 7 has participants liquidating all their assets to pay creditors, Chapter 11 allows for the individual or companies to keep their inventory. Nothing needs be sold off to pay back creditors at this point. Sometimes arrangements are made to pay a little of the debit back at a time but this depends on the financial situation of the company filing for Chapter 11.
Chapter 13 Bankruptcy
A Chapter 13 bankruptcy is similar to a Chapter 7 bankruptcy, however with a Chapter 13; the creditors must be paid back. A payment schedule or plan is put into place and the person who files the Chapter 13 with an attorney is responsible for telling the law office if they can truly afford the payments or not. If they want to keep their belongings, then they need must be honest with themselves first.
