What is bankruptcy? Bankruptcy in the United States seeks to
benefit both debtors and creditors by seeing that debtors get
relief from debts they can't pay, and that creditors get paid
from whatever assets the debtor does not need to live going
forward. Bankruptcy is governed by the federal law found in
Title 11 of the United States Code. As federal law, it
supercedes any conflicting state law by reason of the Supremacy
Clause of the Constitution. With the exception of exemptions, it
is the same from state to state. What types of bankruptcy are
there? There are four kinds of bankruptcy proceedings. They are
referred to by the chapter of the federal Bankruptcy Code that
describes them. Chapter 7 - The Atom-Bomb Bankruptcy (most
common but not always the best) Chapter 13 - Repayment Plan
Chapter 11 - Business Bankruptcy or Over-Limits for Chapter 13
(most expensive) - most large companies reorganize under Chapter
11 Chapter 12 - Farmers bankruptcy is a simplified
reorganization for family farmers, modeled after