Types of Bankruptcy
Posted: Thu Dec 26, 2024 6:53 am
Bankruptcy is a legal process designed to provide relief to individuals and businesses facing significant debt they cannot repay. In San Diego, the most common types of bankruptcy are Chapter 7, Chapter 11, and Chapter 13.
Chapter 7: This is often referred to as liquidation bankruptcy. It allows debtors to eliminate most unsecured debts, such as credit card debt or medical bills after non-exempt assets are sold by a trustee to pay creditors.
Chapter 11: Commonly used by businesses, this bankruptcy belarus whatsapp number data chapter permits the reorganization of debts and business affairs. It enables the company to keep its doors open while repaying creditors under a court-approved plan.
Chapter 13: Ideal for individuals with a regular income, Chapter 13 bankruptcy allows debtors to keep their property and repay debts over time, usually through a three- to five-year repayment plan.
Bankruptcy Process
The process for filing for bankruptcy in San Diego starts with a mandatory credit counseling session. Follow this:
The debtor filed a petition with the bankruptcy court serving San Diego County.
Automatic Stay: Immediately upon filing, an automatic stay goes into effect, which stops most collection activities against the debtor, including foreclosure and creditor harassment.
Chapter 7: This is often referred to as liquidation bankruptcy. It allows debtors to eliminate most unsecured debts, such as credit card debt or medical bills after non-exempt assets are sold by a trustee to pay creditors.
Chapter 11: Commonly used by businesses, this bankruptcy belarus whatsapp number data chapter permits the reorganization of debts and business affairs. It enables the company to keep its doors open while repaying creditors under a court-approved plan.
Chapter 13: Ideal for individuals with a regular income, Chapter 13 bankruptcy allows debtors to keep their property and repay debts over time, usually through a three- to five-year repayment plan.
Bankruptcy Process
The process for filing for bankruptcy in San Diego starts with a mandatory credit counseling session. Follow this:
The debtor filed a petition with the bankruptcy court serving San Diego County.
Automatic Stay: Immediately upon filing, an automatic stay goes into effect, which stops most collection activities against the debtor, including foreclosure and creditor harassment.