The most well known forms of bankruptcy are Chapter 7 and 13 under the Bankruptcy Code. However, other forms of bankruptcy exist including Chapter 9, Chapter 11, Chapter 12, and Chapter 15.

It is recommended to people filing bankruptcy to hire an attorney. Bankruptcy can be a difficult process and it helps to seek the help of a professional.

For Chapters 7 and 13 of the Bankruptcy Code, debtors will be subject to a means test. The means test determines whether a debtor will qualify for either Chapter 7 or Chapter 13. The debtor’s income level and living expenses are used when performing means test calculations.

Chapter 7 Bankruptcy involves liquidating the debtor’s assets in order to repay creditors. In order to do this, a trustee is assigned to the case. The trustee determines which assets, belonging to the debtor, are exempt and not exempt from liquidation. After determining this, all non-exempt items are sold or liquidated. The proceeds from this process are used for debt repayment. The Chapter 7 Bankruptcy process usually takes less than six months to complete.

Chapter 13 Bankruptcy is also known as Individual Deb Adjustment or the wage earner’s plan. Under Chapter 13 of the Bankruptcy Code, debtors must propose a repayment plan to the bankruptcy court. The plan, after being approved, is completed over the next three to five years. A trustee will assist the debtor in the repayment process. The debtor is not always required to repay all of his or her debt, however it is intended to at least repay a portion of the debt.

Chapter 9 Bankruptcy, also known as, Municipality Bankruptcy, provides for cities, towns, counties, and other areas.

Chapter 11 Bankruptcy, often called “Reorganization Bankruptcy,” is typically used for corporations and partnerships. Its main purpose is to ensure the corporation or partnership continues to function and operate while repayments are made to creditors.

Chapter 12 Bankruptcy, intended for family farmers and fishermen, allows the debtor to propose a repayment plan for their debts. The repayment plan may or may not cover the entire debt that is owed by the debtor. Typically, Chapter 12 Bankruptcy is a less expensive way for family farmers and fishermen to file bankruptcy.

Chapter 15 Bankruptcy is used for cross-border cases. Chapter 15 was recently added to the Bankruptcy Code in 2005 when Congress signed the Bankruptcy Abuse Prevention and Consumer Protection Act into law.

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