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Bankruptcy is a legal procedure for dealing with debt problems of individuals and businesses; specifically, a court case filed under 11 U.S.C. title 11 - Bankruptcy. Types of bankruptcy include, but are not limited to:

  • Chapter 7- Liquidation: Occurs when a debtor prefers to liquidate assets rather than keep assets,
  • Chapter 9 – Municipality Reorganization: Occurs when the debtor’s goal is to adjust debts in order to reorganize their finances,
  • Chapter 11 – Business Reorganization: The debtor’s goal is to keep assets and continue business by adjusting its debts; the debtor keeps possession and control of his assets unless a trustee is appointed,
  • Chapter 12 - Allows farmers with real estate debts to pay off the debts from the profits generated by future crops, and
  • Chapter 13 – Individual Reorganization: Debtor’s goal is to keep assets and adjust debts in accordance with a repayment plan.