What are the different types of bankruptcy?

In Massachusetts there are several different types of bankruptcy that are available to individuals and businesses. These types of bankruptcy are divided into two main categories: Chapter 7 and Chapter 13. Chapter 7 bankruptcy is also known as liquidation bankruptcy and is the most common type of bankruptcy filed in the United States. This type of bankruptcy allows an individual or business to discharge all of their unsecured debt while still making payments to secured creditors. A Chapter 7 Bankruptcy will also allow an individual or business to keep some assets, such as a home or car, if they are up to date with their payments. Chapter 13 bankruptcy is also known as reorganization bankruptcy and is available to individuals but not businesses. This type of bankruptcy allows an individual to reorganize their debt so that they can make monthly payments to their creditors over a three to five-year period. At the end of the repayment period, any remaining unsecured debt is discharged. In addition to Chapter 7 and 13, two other types of bankruptcy are available to Massachusetts residents. These are Chapter 11 bankruptcy and Chapter 12 bankruptcy. Chapter 11 bankruptcy is available to businesses and allows them to reorganize their debt and continue their operations. Chapter 12 bankruptcy is available to family farmers and fishermen and allows them to reorganize their debt while still operating their businesses. No matter the type of bankruptcy, each one must be approved by the US Bankruptcy Court before it can be filed. It is important to consult with an experienced bankruptcy attorney to determine which type of bankruptcy is best for you or your business.

What are the different types of bankruptcy?

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