A. STRAIGHT BANKRUPTCY-CHAPTER 7

A Chapter 7 bankruptcy discharges unsecured debts and will stop collection, lawsuits and garnishments regarding such debts. However, such debts such as child support, student loans, certain taxes and other debt specified under the bankruptcy code are not dischargeable. In most cases, a person filing a bankruptcy can keep all of their assets including their homes as well as most personal property. Although bankruptcy is governed by Federal law, State law exemptions are used to determine what assets that can and cannot be protected. The duration of a chapter 7 case is generally 4 months from the date the petition is filed.

B. CHAPTER 13

Chapter 13 is program that allows an individual or individuals ( husband and wife or marital partners) to restructure their debt by providing a monthly payment to a chapter 13 Trustee who periodically pays the debtor's creditors for a period from 3 to 5 years. Like a chapter 7, the chapter 13 will stop lawsuits, garnishments, creditor calls and other collection activity. Only individuals can file chapter 13. Partnerships, corporations and other business entities cannot. The debtor(s) will only receive a discharge of their debts upon successful completion of their repayment plan. Most consolidation cases can be filed with only payment of the filing fee.

C. CHAPTER 11

Corporations, partnerships, and sole proprietorships wishing to remain in business and reorganize their financial affairs may file Chapter 11. These debtors seek to restructure their debts either by reducing the debt or by extending the time to repay. A Chapter 11 plan can also be used to liquidate all or a portion of debtor's assets.