If you have been considering filing bankruptcy, you may have been surprised to find that there are four different chapters under which you can file. Title 11 of the Federal Bankruptcy Code outlines Chapter 7, Chapter 11, Chapter 12, and Chapter 13 bankruptcy filings. Read more to find out the differences between the chapters and don’t forget to consult a lawyer to help you consider your different options.

A Helpful Guide to 4 Chapters of Bankruptcy

1. Chapter 7

Chapter 7 is the most common filing and is designed to help give debtors a clean financial slate. The first step after filing is to work with a trustee to plan the sale of your assets. Most of the things that you own will be sold in order to partially pay your debts. However, federal and state laws allow for certain exemptions and you may be able to keep your home and your personal items such as your clothing. After the items have been liquidated and the debtors have been paid, many of the remaining debts will be discharged. Some of the debts that will not be forgiven include child support, alimony, taxes, and many student loans.

2. Chapter 13

Chapter 13 bankruptcy is designed to help debtors with regular income adjust their debts to make them more manageable. You’re eligible as long as you have a steady income and your debts don’t exceed $269,250 unsecured and $807,750 secured. After filing, a trustee will be assigned to you to help you develop a repayment plan proposal. The plan is then presented and the court decides whether to accept it as it is or offer adjustments. Once accepted, the repayment plan lasts from three to five years.

3. Chapter 12

Chapter 12 is almost exactly the same as Chapter 13 bankruptcy, but is designed for family farmers. The process is the same. A trustee helps develop a repayment plan which is then accepted or changed by the court.

4. Chapter 11

Similar to Chapter 13 bankruptcy, Chapter 11 allows debtors to reorganize their debts to make them easier to pay. The biggest difference is that with a Chapter 11 filing, there are no limits applied to the amount of money that the debtor owes. If you have an amount of debt that exceeds the limits set forth in Chapter 13 bankruptcy, Chapter 11 may be your best option.

Get help navigating bankruptcy law by consulting Hurtt & Johnson LLC in Dalton, GA. These experienced bankruptcy attorneys have been serving Dalton and the communities of Northwestern Georgia since 1977. They have thousands of successful cases and were awarded a Medal of Excellence by the American Bankruptcy Institute. Attorneys Michael Hurtt and David Johnson are well-versed in Chapter 7 and 13 bankruptcy and are prepared to help you take back control of your financial future. Call (706) 226-5425 today to schedule your free initial consultation or visit the website for more information.