The four bankruptcy filings are chapters 7, 11, 12 and 13. Chapter 7 is the most common of all the filings. Chapter 7 generally requires you to liquidate your finances, and you will most likely have to start over after filing bankruptcy chapter 7. Chapter 7 is designed for a trustee to liquidate your assets, and then apply any monies made from the sale toward your debt. After this process, any much of the left over debt can be forgiven and you will be mostly debt free. If there are debts that were not forgiven, you cannot include them on any future bankruptcies you may file.
Chapter 13 and chapter 12 bankruptcy filings are extremely similar, except chapter 12 is pertains to family farmers and chapter 13 is for everyone else. You generally are required to have a job and an income before you can file for either chapter, and usually secured debt and unsecured debt criteria must be met in order to file either chapter. After filing, it is typically customary for a monthly repayment plan to be proposed to the creditors and the trustee makes sure that all creditors are paid monthly.
Chapter 11 bankruptcy filings are similar to chapter 13, except there is no limit as to the amount of money you owe to the creditors. If you have a debt amount over $269,250 for unsecured debt and over $807,750 for secured debt, you can use chapter 11. If the debt is under these amounts, you would most likely qualify for chapter 12 or 13.
Bankruptcy filings stay on your credit report for seven to ten years. You cannot file in bankruptcy court for seven years after the discharge of the first one, so before filing bankruptcy it is generally a good idea to consider all your options. Should you choose to, speaking to a credit counselor might expose different way to for you to get your debts paid off without choosing bankruptcy filings.
Also, be sure to read about the latest bankruptcy news.
