The U.S. Constitution gives Congress power to make bankruptcy legislation. There are two major kinds of bankruptcy options for people and organizations: liquidations and Reorganizations. Chapter seven covers liquidations.

Chapter seven bankruptcy allows the debtor to discharge all outstanding debtswith no exception, including child support payments. The trustee appointed by the bankruptcy judge to examine your property and decide on a percentage to pay back creditors. Only a limited number exempted items can be used in the chapter 7 bankruptcy debtor. Anything that isn’t exempt can be sold to pay back creditors.

Chapter 7 bankruptcy filings are more common than you think. A number of famous individuals have used these laws including Walt Disney. They allowed Walt Disney to have greater financial freedom, which let him devote much of his time designing the characters that he loved. You can learn more through this short video, and also check out the bankruptcy attorney if you need assistance.

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