Different Types of Bankruptcy to Cover your Debts

Business owners desire to make the most out of their investment. They get funds from several financers to build a successful venture. However, due to different factors, there are businesses that suddenly fail and lose finance. Worse, they experience bankruptcy that leaves all their creditors hanging. Fortunately, the state can help such business people in covering their debts.

Declaring bankruptcy would mean the end of one's career and crashing of all properties. However, it is the most effective way to stop persistent letters and calls of creditors and aid financial stress. If you are considering this to resolve your dilemma, here are different types of bankruptcy you can declare.


One of the most commonly filed is the Chapter 7 bankruptcy. It is a liquidation process that turns debtors' assets into cash. The resulting amount will then be used to pay off creditors. Once all assets are consumed, the remaining debts will be handled by a trustee designated by the court.

Another type of bankruptcy is the Chapter 11 bankruptcy. This process gives a chance to business owners to create a financial reorganization. When their creditors and the court approved their plans, they are dishonored with some leases and contracts so that they can begin a new operation with less debt. With fewer business operations, they may also be charged with less tax assessed by such somekeyword hosts, and have more means in continuing their business.

Chapter 13 bankruptcy includes the prevention of home disownment like such somekeyword, and approval of repayment plan. Most often, business owners who engage in this petition are granted with longer time frame in paying their debts. They are provided with a trustee who assists them throughout their case and payment. The same process applies to Chapter 12 bankruptcy. Only, the latter is exclusive for farmers and fishermen.

Lastly, Chapter 15 bankruptcy assists people with debts from business owners in other states. If for instance you are experiencing somekeyword and your foreign creditors have been sending you notices with regards to your liabilities abroad, then you may pay them as you file Chapter 15. They have the right to attend US court sessions and file a claim to your business.

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