Chapter 13 provides a softer landing for people with outstanding debts that they are unable to pay. This is because the period of time between which they can repay the loan is usually longer and none of their property will be sold. However, getting a Chapter 13 bankruptcy filing to be granted is usually very difficult and one must have sufficient grounds to support it or must be under special circumstances. If one can prove to a judge that the loan default was caused by temporary circumstances, such as a natural disaster, which made them to start life all over, they have a better chance of being declared bankrupt under Chapter 13.

Most people succeed to file for bankruptcy under Chapter 7 because they can sell off their valuable possessions and have their debts wiped off completely. If one does not have valuable items to sell such as a house, a car or expensive jewelry, they might be declared bankrupt on their own volition but after an application by their creditor. This might be after the creditor has attempted to recover a huge debt over many years without success. Filing Chapter 7 bankruptcy is much quicker than filing Chapter 13 but it has been made harder with the requirement to pass the Bankruptcy Means Test.

Municipalities whose towns have debts can file Chapter 9 bankruptcy, while Chapter 11 is mostly for businesses and individuals with very huge debts. Chapter 12 is a bankruptcy that is usually filed by farming and fishing families to help them recover from such losses they might incur during the practice of their business. These businesses are full of risks and some poor farmers are not able to acquire agricultural credit due to strict rules. For international businesses, they might file Chapter 15 when their debtors are from across borders.

All bankruptcy cases severely affect one’s credit report and may prevent them from taking a loan or buying things on credit from other people for up to 10 years. On the other hand, when one is declared bankrupt, all the Chapters, except Chapter 7, allow them to maintain possession of their assets. The creditors are also mandated to stop attempts to recover their debt, or force the closure of the business for the period that the bankruptcy is in effect. To benefit most from bankruptcy declaration, one must choose the best plan that is best for his situation and file for it. The rest is up to the judges to approve the application.

Bankruptcy Modification Bankruptcy Attorney Bankruptcy Lawyer Bankruptcy Foreclosure