Bankruptcy is a means for individuals and businesses to get a fresh start by either eliminating their debt or repaying their debt over a term of months (usually 60 months).
Chapter 7--eliminates most unsecured debt. In business this is a liquidation of assets to be distributed to creditors.
Chapter 11--business reorganization plan.
Chapter 12--farming reorganization plan.
Chapter 13--repayment of debts usually over 60 months. Can be an effective means to keep a family home if you’re behind on your payments.
Chapter 7: Eliminates most unsecured debt (usually will not eliminate student loan debt).
Secured Debt--3 Options:
Reaffirm
Surrender
Avoid Lien (non-purchase money lien)
The Means Test (looks at median household income for household of your size)
Chapter 13: Repayment plan usually over 60 months
Can put arrearage on mortgage in plan and pay mortgage outside plan
Repayment is usually less than 100% and can be based on your income
Can be payroll deducted
(502) 245-9100
