Types of Bankruptcy
Our Jackson bankruptcy attorney explains the types of bankruptcy options available to those considering bankruptcy.
Chapter 7 allows debtors in financial difficulty who do not have the ability to pay to discharge their debts. Under Chapter 7, you may claim certain property exempt (that is, you can keep the property) and a trustee may take possession of the remaining assets in order to liquidate them and pay your creditors according to priorities set forth in the Bankruptcy Code. In most cases, the debtor does not lose any property. See the United States Trustee’s Bankruptcy Information Sheet.
Chapter 13 allows individuals who are temporarily unable to pay their debts to pay them in installments over a period of time.
Chapter 11: Reorganization
Chapter 11 is designed primarily for the reorganization of a business. Its provisions are very complex and should be done only after consulting an attorney.
Chapter 12: Family Farm
Chapter 12 is designed to permit family farms to repay their debts over a period of time.