Bankruptcy
Bela Candelaria
What Is It?
When someone can't pay back their debts
Debtor- person who borrows money or owes money
Creditor- person that is owed the money or lent the money
Debtor- person who borrows money or owes money
Creditor- person that is owed the money or lent the money
Where Did It Originate?
In Ancient Greece
-simple solution
-if debtor cannot pay debt, becomes debt slave to creditor.
-Have to pay off in labor
Mid-Evil Europe
-Debtors prison: throw you in jail and not coming out until family pays off debts
-simple solution
-if debtor cannot pay debt, becomes debt slave to creditor.
-Have to pay off in labor
Mid-Evil Europe
-Debtors prison: throw you in jail and not coming out until family pays off debts
Types of Bankruptcy
Chapter 7
Straight Bankruptcy:
-Go to courts and file for bankruptcy
-They take your assets and split them between creditors
-You owe nothing after this
-Also take all money and valuables and sell to creditors
-Stays on credit report for ten years
-Go to courts and file for bankruptcy
-They take your assets and split them between creditors
-You owe nothing after this
-Also take all money and valuables and sell to creditors
-Stays on credit report for ten years
Chapter 13
Reorganization:
-Ask creditors to reorganize a plan to be able to realistically pay back in 3-5 years
-Stays on credit report for ten years
-Ask creditors to reorganize a plan to be able to realistically pay back in 3-5 years
-Stays on credit report for ten years