Bankruptcy
Chapter 7 Liquidation
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Case filed and automatic stay goes
into effect stopping all collection activity.
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All non-exempt assets of debtor are
subject to being liquidated (sold) to pay creditors.
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Meeting of the creditors about
40-45 days after filing.
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Discharge of debts happens about
100 days after the filing.
Chapter 13 Individual
Reorganization
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Case filed and automatic stay goes
into effect and all collection activity must cease collection or
risk penalties.
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Total debts reduced and remaining
debts paid to creditors over a 3 to 5 year plan.
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The debtor/client proposes a plan for
repayment of creditors. Trustee appointed. Debtor
makes monthly
payments to trustee for creditors. Some
creditors will be paid directly by debtor. Debtor retains all
assets whether exempt or not.
Bankruptcy Proceedings
- Pre-petition
- Filing of Petition
- Meeting of Creditors
- Discharge