About Bankruptcy


     Bankruptcy law consists of six different chapters under which individuals or organizations may file. A "chapter" refers to the section of federal law that provides the rules for how a bankruptcy case is to be decided. These six chapters are:



Chapter 7: Liquidation for Individuals or Businesses

Chapter 9: Municipal Bankruptcy

Chapter 11: Reorganization for Individuals or Businesses

Chapter 12: Reorganization for Family Farmers or Fisherman

Chapter 13: Reorganization for Individuals only

Chapter 15: International or Ancillary Cases


    Of these, an individual may file for bankruptcy protection under one of four Chapters: 7, 11, 12, or 13.



Chapter 7: Nearly all individuals file under this chapter.

Chapter 11: Very expensive and creditors control the case

Chapter 12: Can only be used by farmers or fisherman

Chapter 13: Used by people who either do not qualify for, or who have too much equity to lose by filing, a Chapter 7 case, and/or who can benefit best by some of the special features of Chapter 13.


    Essentially, therefore, an individual's choice of bankruptcy is between Chapter 7 and 13. Since Chapter 13 is a repayment plan with many additional costs and risks (see the Chapter 13 page for more details), most people who qualify for Chapter 7 use that form of bankruptcy rather than Chapter 13.


    See the additional information provided about Chapter 7 cases and The Automatic Stay, and the important details provided about Exemptions, the Meeting of the Creditors, and the Means Test.

4212 2x3 crop - bright - tight.jpg

Dale Orthner

(916) 588-5011

Contact Us

For a FREE, 1-hour consultation

with Dale Orthner, call:

(916) 588-5011