Understanding Chapter 7 and Chapter 11 Bankruptcy Filings

Most people don't ever want to have to file for bankruptcy. Some people look at it as a negative reflection on their lives. If you have ever thought of filing bankruptcy, then you should know that it isn't easy. You will be asked for every type of financial dealing that you have ever had. You will have to provide bank statements, receipts and explanations of all of your personal spending. All of your personal and financial business dealings will go into public bankruptcy records. A personal bankruptcy is called a chapter 7 and a business bankruptcy is a chapter 11.

If you have been the type of person who hasn't been completely honest in your financial dealings, then you will be exposed. Some people who file for bankruptcy are very honest people. They may have just gotten in over their heads in credit card debt or they might have lost their job and can no longer pay their bills. It can be very discouraging and a huge burden to wonder how you are going to pay the bills every month. When you have a family and you have too many debts, then having public bankruptcy records are the least of your worries.

Most people who are just your average Joe can file for a chapter 7 bankruptcy. In a chapter 7, you can keep your home, your car and even most of your household things. The bankruptcy court still wants you to be able to survive and when you file bankruptcy, you should see it as a second chance. If you have a business, then you may have to go with a chapter 11 bankruptcy. A chapter 11 bankruptcy can be very complicated and you should hire a professional to help you get all of your bankruptcy records in order.

Filing for bankruptcy is a hard decision to make when you are in over your head financially. Depending on your circumstances, it can be a solution to most of your financial problems. If you have nothing to hide, then your bankruptcy records will never be a threat to you. Talk to a professional about bankruptcy before you ever try to file. There may be another solution to your money problems. Be cautious, because filing for a bankruptcy could be the most important decision of your life.