Who pays for bankruptcy? This is a question that often comes up when individuals or businesses are considering filing for bankruptcy. The answer, though, is not always simple.
There are two types of bankruptcies: Chapter 7 and Chapter 13. In a Chapter 7 bankruptcy, the debtor’s assets areLiquidated and distributed to creditors. In contrast, a Chapter 13 bankruptcy involves the reorganization of the debtor’s finances so that they can make payments to creditors over time.
So, who pays for a Chapter 7 bankruptcy? The answer is that the debtor’s assets are used to pay off creditors. Any remaining debt is discharged, which means that the debtor is no longer legally obligated to pay it. This can be a good