Thousands of great deal and businesses file away for bankruptcy each year in the United States. Bankruptcy is broken up into several unlike chapters and the most common chapter is the Chapter 7 extinction bankruptcy police, which is discover known as straight bankruptcy. When population file for Chapter 7 bankruptcy their ad hominem property is sold for cash and and so evenly dispersed to the all the collecting creditors. Anyone nookie file for Chapter 7 bankruptcy including corporations, partnerships, and individuals. To file for Chapter 7 bankruptcy thither is a strict set of procedures that someone must follow. The rootage major step and the most important is to file a petition with the bankruptcy court (Cheeseman, 2006).
There is a in the buff bankruptcy law that is now in effect transaction with Chapters 7 and 13 bankruptcy laws. The old law utter that filers could decide on which type of bankruptcy they wish to file either Chapter 13 repayment or Chapter 7 liquidation of the outstanding debt. The new law states filers that have a high income lead not be permitted to file for Chapter 7 bankruptcy. The filers will instead have to file Chapter 13 bankruptcy law that requires repayment of least some of their debt (NOLO, 2007).
There are many a(prenominal) different reasons people and businesses file bankruptcy.
One of the major causes for people to file for bankruptcy is to make all their quick debt to disappear. By filing Chapter 7 bankruptcy they are wiping out their existing debt to start fresh with out any debt. People would preferably file bankruptcy rather than foreclosing on their home. If someone can not pay their car bill or another(prenominal) personal property loans they file bankruptcy to prevent their personal items from being repossessed. There are many other reasons people may choose to file bankruptcy to prevent...
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