• stevehobbes@lemy.lol
    link
    fedilink
    arrow-up
    14
    ·
    11 months ago

    That’s chapter 7. There are some debts that cannot be wiped out via bankruptcy. That’s true for corporations too. And when it happens, they get liquidated.

    You can’t really liquidate a person and cease it to be an ongoing concern. The dynamics are different.

    Chapter 11 can and does get filed by people - but it’s a reorganization, and buys you time to negotiate with the debt holders if able for a reduced amount or a longer repayment plan or reduced interest instead of going through chapter 7 where they’ll get nothing or very little if it’s unsecured debt.

    Both will tank your credit.