The Process of bankruptcy

Article Written By: Sneha Sahi

Everyone in their life faces a tough financial situation over which one does not have any control. In today's world our financial transactions and our life are very much dependent on credit and loans. We all have some or the other form of Credit on our name but the real problem is not having credit but actually repaying it.

Many people face this problem, they have their creditors knocking on their door but have no money to repay them. For such people who have no other option of repaying their debts, filing for bankruptcy is a good choice. Once you have decided that filing for a Bankruptcy is the last option for you, the question of how to do it arises.

There are mainly 3 major types of bankruptcies-

1. chapter 7 bankruptcy information - It is the most common type of bankruptcy filled by people across United States of America. This is a liquidation bankruptcy, which means that the trustee sells off all non-exempt assets held by the debtor so that the debts can be repaid to the fullest extent possible. Not all but Individuals, corporations and partnerships are can file for Chapter 7 bankruptcies.

2. Chapter 11 - In this type of Bankruptcies, the debtor does not need to sell of his estates and other assets. He can continue to work as an organization but requires a well suited plan to which can repay his debts. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 imposes a 120-day time limit on filing of a repayment plan.

3. Chapter 12 - This type of bankruptcy service. is specifically designed for farmers and farm owners, like the chapter 11 here also a farmer does not loose his assets but works on a newer debt repayment plan.

So now you know what types of bankruptcies are there in the USA laws and if you are planing to file one make sure that you go through the terms and conditions of all of them to make sure which is best suited for you.

Always remember that filing for a bankruptcy is an important decision and it can affect your future life about to come, so such a decision must only be taken after careful consideration and consultations with professionals.

If need then never be shy away to seek help from a qualified lawyer and any friend or relative who have previously gone through this phase of life.

About the Author

Sneha Sahi is a law graduate. She is an internationally recognized expert in Filing for bankruptcy and other bankruptcy service

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