Differences Between Chapter 11 and Chapter 7 Bankruptcy
Most individuals know when the time is "right" for them to file for bankruptcy, however what they may not be familiar with is the differences between various bankruptcy filings. Bankruptcy in general should always be avoided if possible as this will leave a very bad black streak on your credit record for seven years.
CHAPTER 7 BANKRUPTCY
Chapter 7 bankruptcy is better known also as “T-Total Bankruptcy” This will make you have no further obligations to prior debts after a successful chapter 7 filing. However in cases of business they also would require that the business liquidate all assets to pay as much of the debt as possible. Chapter 7 bankruptcy is primarily used to give the debtor a “fresh start”
The courts must charge the following fees associated with filing a Chapter 7 Bankruptcy:
- A $245 filing fee.
- A $39 administrative fee.
- A $15 surcharge.
If the debtor's income is less than 150% of the poverty level (as defined in the Bankruptcy Code), and the debtor is unable to pay the chapter 7 fees even in installments, the court may waive the requirement that the fees be paid. 28 U.S.C. § 1930(f).
A list of information you must provide to file is as follows:
1. A list of all creditors and the amount;
2. The source, amount, and frequency of the debtor's income;
3. A list of all of the debtor's property; and
4. A detailed list of the debtor's monthly living expenses
CHAPTER 11 BANKRUPTCY
Chapter 11 bankruptcy is more commonly known as debt consolidation. This is where your debts are organized into one mass bill usually heavily discounted and you simply begin paying on this debt on a monthly basis till paid off.
The courts are required to charge the following for a Chapter 11 Bankruptcy filing:
- A $1,000 case filing fee
- A $39 miscellaneous administrative fee.
More information on both Chapter 7 and Chapter 11 Bankruptcy can be found at the following links:
US Courts-Chapter 7 Bankruptcy
US Courts-Chapter 11 Bankruptcy