Chapter 13 Bankruptcy Research Paper

The recent statistics on bankruptcy in America are staggering. Weather more people are actually unable to control the amount of debt they have or they are just being irresponsible and taking the easy way out, in recent decades the numbers have continued to rise, so much that our government has stepped in to address the issue making it harder to qualify for this bankruptcy. In this essay I will discuss what bankruptcy is, what causes bankruptcy and how to avoid it?
Bankruptcy is a term used to define a court process that assist civilians and businesses get out of debt by repaying what they owe. Once you have met the qualification standards the courts will protect you during the court process. While there are several different types of bankruptcy,
When this option is chosen the party involved must be able to come up with a very strict budgeting plan that will pay most if not all of your debts within three to five years. How much you will be required to repay depends on several factors such as your earnings, your debt, and how much the creditors of your unsecured loans would have received if you had filed under Chapter 7 instead of Chapter 13. Like Chapter 7 there are qualifications that must be met in order to file Chapter 13 bankruptcy, your debt must be under the limit for filing, as of September, 2009, the limit on secured debt was $1,010,650 and the limit on unsecured debt was $336,900. Any amounts above these limits and you may not be able to file Chapter 13 bankruptcy. In addition to Chapter 13 there are two other types of reorganization bankruptcies, Chapter 11 and Chapter 12. Chapter 11 bankruptcies are typically files by businesses that need a little help getting their affairs in order and help paying off their debts. Also civilians can file for Chapter 11 bankruptcy if they don’t met qualifications for Chapter 13 bankruptcy or own several homes. It is advised that Chapter 11 can be expensive