FILING FOR BANKRUPTCY
THERE HAS BEEN a substantial increase in bankruptcy filings during the past year in Maine as inflation, the economic slowdown and rising home foreclosures have taken their toll.
THERE ARE SIX types of bankruptcies. The most common for individuals are Chapter 7 and Chapter 13.
CHAPTER 7: Debtors surrender their property to a bankruptcy trustee, who then liquidates the property and distributes the proceeds to the debtors' unsecured creditors.
CHAPTER 13: Debtors retain ownership of their assets but must devote a portion of their future income to repaying creditors. It is also called "a wage earner's plan" because it enables individuals with regular income to develop a plan to repay all or part of their debts.
CHAPTER 9: For municipalities.
CHAPTER 11: Primarily for business debtors to help them reorganize.
CHAPTER 12: Geared for family farmers and fishermen.
CHAPTER 15: Intended for dealing with insolvency cases involving debtors, assets or claimants involving more than one country.
Source: Administrative Office of the U.S. Courts