what is the difference between chapter 7,11 and13

Get Legal Help Today

Compare Quotes From Top Companies and Save

secured lock Secured with SHA-256 Encryption

what is the difference between chapter 7,11 and13

Asked on July 4, 2009 under Bankruptcy Law, Arizona

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 14 years ago | Contributor

Here's a link to a site that I think you will find helpful:  http://www.uscourts.gov/bankruptcycourts/bankruptcybasics/process.html

You may want to consult with an attorney in your area on this.  if you need help in finding one that specializes in these type cases you can try:  www.AttorneyPages.com.

Best of luck.

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 14 years ago | Contributor

"Chapter 7 is the most common form of bankruptcy. It is a liquidation proceeding in which the debtor's non-exempt assets, if any, are sold by the Chapter 7 trustee and the proceeds distributed to creditors according to the priorities among creditors established in the bankruptcy Code.  Chapter 7  is available to individuals, married couples, corporations and partnerships. Individual debtors get a discharge within 4-6 months of filing the case.  

If there are assets which are not exempt, the trustee takes control of those assets, sells them and pays creditors as much as the proceeds permit. Any wages the debtor earns after the case is begun are the debtor's; the creditors have no claim on those earnings.

Chapter 11 is a reorganization proceeding, typically for corporations or partnerships. Individuals, especially those whose debts exceed the limits of Chapter 13, may file Chapter 11.  In Chapter 11, the debtor usually remains in possession of his assets and continues to operate any business, subject to the oversight of the court and the creditors committee.  

The debtor proposes a plan of reorganization which, upon acceptance by a majority of the creditors, is confirmed by the court and binds both the debtor and the creditors to its terms of repayment. Plans can call for repayment out of future profits, sales of some or all of the assets, or a merger or recapitalization.

Chapter 13 is a repayment plan for individuals with regular income and unsecured debt less than $336,900 and secured debt less than $1,010,650. The debtor keeps his property and makes regular payments to the Chapter 13 trustee out of future income to pay creditors over time (3-5 years).  

Repayment in Chapter 13 can range from 10% to 100% depending on the debtor's income and the make up of the debt.   Certain debts that cannot be discharged in Chapter 7 can be discharged in Chapter 13. Chapter 13 also provides a mechanism for individuals to prevent foreclosures and repossessions, while catching up on their secured debts. "


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption