[16-Jan-2020] DarksydePhil is filing for bankruptcy (general thread) - and has officially done so on January 31 2020, meaning a lot of his finances have become public

What will happen with his case following the 341 meeting?

  • Still gets Chapter 7

    Votes: 126 18.1%
  • Changed to Chapter 13 and ultimately fails to make his required payments

    Votes: 218 31.3%
  • Chapter 13 and successfully completed all payments

    Votes: 19 2.7%
  • Complete dismissal of the bankruptcy

    Votes: 334 47.9%

  • Total voters
    697
Status
Not open for further replies.

Comma

kiwifarms.net
I guess we need a thread on this.

:informative: Scroll down for updated information in chronological order :informative:


- Mirror of the bankruptcy segment of January 16, 2020's early stream, where DSP reveals to the public he's in the process of filing for bankruptcy:


- Very brief summary:

- basically all information about the foreclosure [thread] is confirmed to be correct (mortgage company is selling the home, probably for tens of thousands of dollars less than what DSP still owes on it)
- to get rid of his debts and save his Renton house, DSP is filing for bankruptcy
- might have to sell possessions, but "important" possessions (consoles, streaming equipment, the car etc.) should be safe, according to DSP('s bankruptcy lawyer)
- once the bankruptcy is in full effect, (most of) DSP's financial information will be publicly available

- Lengthier summary, courtesy of @Prince Lotor:

[Text removed due to reaching the character limit - click here for the original post and text]

- @SoapQueen1's estimations of DSP's options from the "Foreclosure" thread, including Bankruptcy and its details:

[Text removed due to reaching the character limit - click here for the original post and text]


-UPDATE- January 18, 2020

(added by actually) General information on and differences between types of bankruptcy (Chapter 7, 13 etc.):


The means test measures your income and debt. The outcome will determine which chapter you’ll need to file to discharge (erase) debt.

  • Chapter 7 bankruptcy. If your household income is lower than the median income of your state, you can receive a discharge in a Chapter 7 case. If it’s higher, you might still pass the means test after subtracting allowed expenses. If you qualify for Chapter 7 but want to take advantage of benefits only afforded in Chapter 13—such as catching up on a home loan—then you can pay into a three-year Chapter 13 plan, rather than a five-year plan.​
  • Chapter 13 bankruptcy. If your income exceeds the Chapter 7 limits, your bankruptcy options will be limited to paying into a five-year Chapter 13 repayment plan. But doing so isn’t automatic. You must have enough income to pay all required debts. Determining your Chapter 13 bankruptcy payment requires a calculation similar to that in Chapter 7. You’ll pay whichever is greater: your disposable income, the value of your nonexempt property, or the amount of your nondischargeable debt (such as support obligations and tax debt).​

Here's what will happen to nonexempt property (things you can’t protect with an exemption):
Washington Homestead Exemption
The homestead exemption protects up to $125,000 of equity in a debtor’s home or principal residence, including a manufactured or mobile home. The exemption is reduced to $15,000 for other personal property used as a residence. (RCW §§ 6.13.010, 6.13.020, 6.13.030.)

Washington Motor Vehicle Exemption
A debtor can exempt up to $3,250 in one motor vehicle. Spouses filing jointly can each exempt a vehicle. (RCW § 6.15.010(1)(d)(iii).)

Washington Wildcard Exemption
A filer can exempt up to $3,000 worth of any type of personal property other than wages with the following limitations: no more than $1,500 total in cash, $500 for bank accounts, and $2,500 toward educational loans. (RCW § 6.15.010(1)(d)(ii).)

Washington Tools of the Trade Exemption
A debtor can exempt up to $10,000 in tools, instruments, and materials used to carry on his or her trade. Special exemptions are available for farmers, physicians, attorneys, and clergymen. (RCW § 6.15.010(1)(e)(i)-(iii).)


-UPDATE- JANUARY 31, 2020

DSP has now officially filed for Chapter 7 bankruptcy + analyses by KF members:

As of today, DSP has officially filed for bankruptcy and the bankruptcy forms, which means a lot of DSP's financial information, have become public. You'll find them at the bottom of this OP and in the following post:

He filed with the court. I can get documents in a minute or someone else can.

He's counting over $5000 per month of business expenses.



Fist analysis of the filled-out forms:

[Text removed due to reaching the character limit - click here for the original post and text]

Bankruptcy analysis and FAQ thread:


TL;DR Overview
Phil has filed for bankruptcy as of Jan 31st, 2020. He claims business expenses of approximately $5000 a month (including $9000 in July 2019), which is likely bullshit (see spoilers below). The monthly income estimations have been proven to be extremely accurate, with all months failing within (or very close to the range) of the numbers from the DSP Savings and Loan thread. Kat is confirmed to be working part-time retail, currently at Fred Meyer. Based on reported salary, she's working about 20 hours a week. From the filed documents, it looks like Phil is trying to flat out lie to the court. This is going to be broken down in detail below.

Phil's Debts
Federal Taxes = $15,000 (It's not clear if this is just remaining from 2018, or if this includes an estimation of 2019's federal taxes as well. Presumably it's only 2018.
WA Condo = $227,448.00 (30 year apparently fixed 5% interest; started at $251,750 on May 22nd, 2014; amortization schedule can be calc'd here)
CT Condo = $105,890.00
2017 Toyota Corolla = $14,328.00 (with all of 5000 miles put on it :lol:)
American Express CC = $1,128.00
American Express CC = $6,422.00
Bank of America = $26,038.00
BMW Bank of North America = $2,741.00
Capital One CC = $10,751.00
Chase CC = $14,100.00
CitiBank CC = $8,508.00
Citibank CC = $13,885.00
Citibank = $15,601.74
Discover CC = $10,053.00
Lending Club Corporation = $9,397.00
Prosper Marketplace, Inc. = $4,355.00
SYNCB/Sam's = $3,819.00
US Bank = $4,751.54

Total CC/Loan Debt = $131,550.28
All Debt = $479888.28

Got a question you want to see answered and added to the FAQ? Use this thread:


@SoapQueen1 has made a thread in the LLP subforums with discussion of the legal implications:



-UPDATE- February 3, 2020

A '341(a) Meeting of Creditors' has been scheduled for March 5, 2020, at 10:00 AM:

A 341(a) Meeting of Creditors gives both the court and creditors the chance to question the debtor about information provided in the bankruptcy filings. This all happens under oath.

BREAKING NEWS

Meeting with the creditors has been scheduled for 3\5\2020 at 10am with Trustee Nancy L James.


Source
View attachment 1127996
Source 2
View attachment 1127997
New document attached. Also his request to pay filing fees in installments was approved.

Examples of how 341(a) Meetings are conducted in general:

- 341(a) Meeting script

http://www.chi13.com/Web/341script.html

- 341(a) Meeting recording


Note: DSP's meeting could be (slightly) different, but the examples above should give a good impression of the general idea.

Nick Rekieta discusses the 341 meeting as it relates to Phil:



-UPDATE- March 23, 2020

The 341 Meeting of Creditors was rescheduled, changed to a conference call,

and MidFirst Bank filed for a Relief from Stay on the CT condo mortgage:

Useful links:
- Kiwi Farms thread dedicated to DSP's 341 Meeting of Creditors
- https://www.docketbird.com/court-cases/Philip-P-Burnell/wawb-2:2020-bk-10323 (shows current docket information for the case)
- Kiwi Farms thread dedicated to the CT condo foreclosure procedure

1. DSP's 341 Meeting of Creditors that was scheduled for March 5, 2020 was rescheduled at the request of his attorney because she was sick:

DSP's lawyer had the corona on the 5th March

View attachment 1203060

bankruptcy lawyer attorney sick ill hearing.jpeg


DSP WAS A NO SHOW

PUSHED TO MARCH 26TH

Edit: DSP was called. No showed. Stand in for Rochelle asked for an extension. Trustee gave the date.
Rochelle didnt show up either she was representing 2 others and had a stand in for them today.
Edit: The stand in represented the two people that went before DSP, and then represented DSP+Rochelle to ask for an extension. Sorry I misunderstood my contact's message.
DSP was called. The stand in for Rochelle asked for an extension. Trustee gave 3/26.

My contact said the first guy on the docket had a company too and the trustee grilled him with detailed questions about expenses and how he spent them for the company and how he paid his employees etc. So something to look forward to.
Sorry, I misunderstood a message from my contact and I want to correct it:
The stand in for Rochelle represented the two people that went before DSP. He must work at the same firm. But not all three of them were Rochelle's clients. DSP was the only client of Rochelle's in the morning.

2. The 341 Meeting was then rescheduled for March 26, 2020 at 10:30 AM:

Phil's next 341 meeting scheduled for 26 March at 10:30am.

Statement Adjourning 341(a) Meeting of Creditors. Section 341(a) Meeting Continued on 03/26/20 at 10:30 AM at US Courthouse, Room 4107 (341 Meetings). Debtor absent. (Text entry; no document attached.)


3. the 341 Meeting was then changed to be conducted through telephone, probably due to the Corona virus situation, but still at March 26, 2020 at 10:30 AM:

It will still take place March 26 at 10:30 AM. It will just be over the phone. You have to actually read the document rather than making assumptions.

341 meeting telephonically March 26 2020.PNG


The full document with its original name is attached in the post quoted above, and can be found attached below this OP as "341 Meeting to be held over telephone at March 26 2020.pdf".

4. On March 16, 2020, MidFirst Bank files a Support of Motion for Relief from Stay for the CT condo, in order to still be able to proceed with the foreclosure and possibly sue DSP for the difference between the sum they get for selling the condo (plus potential extra expenses made) and what DSP still owes on the mortgage:

03/16/2020
Declaration in Support of Motion for Relief from Stay (Related document(s)[14] Motion for Relief from Stay). Filed by Lance E Olsen of McCarthy & Holthus, LLP on behalf of MidFirst Bank. Document Number: 15


Another thingy on docketbird:

03/16/2020
Motion for Relief from Stay, 3699 Broadbridge Ave Unit 107, Stratford, CT 06614. Proof of Service. Filed by Lance E Olsen on behalf of MidFirst Bank The Hearing date is set for 4/10/2020 at 09:30 AM at Judge Dore's Courtroom, U.S. Courthouse, Room 8106. Response due by 4/3/2020. Document Number: 14

Blah, so Lance Olsen is only coming for the CTkhando.
And to think, this could probably have been avoided if Phil didn't skip out on March 5.

Documents courtesy of MrHuth

@AnOminous, @Beetus Knuckles, and @SoapQueen1, could we get a quick summary of what this means for the laypeople (myself included)? It sounds like, based on what's been posted that:

1) MidFirst didn't take kindly to Phil's skipping the meeting and is trying to get their money.
2) MidFirst is pursuing this action specifically to try and file a deficiency for ~$50,000, based on the difference between the current loan balance and their appraised value of the CT Condo.
3) This action is what may have caused Phil to ramp up the begging hard in recent days.

Now, what would you think is the most likely outcome of the motion that MidFirst has filed? Will it be ruled on before the next creditor meeting, or will Lance (or an associate) roll into the meeting (over the phone or whatever) and verbally cut Phil's nutritionally-deficient chicken legs out from under him? If the judge allows the motion, how does it affect the rest of the bankruptcy?

I'm going for this. They specifically cite the deficiency between the value of the security interest and the underlying debt as good cause for lifting the stay.

View attachment 1191282

5. There will be a hearing regarding MidFirst Bank's motion on April 10, 2020 at 9:30 AM at the US Bankruptcy Court in Seattle:

MidFirst Bank's Relief from the Automatic Stay motion seeking.PNG


The corresponding documents (five of them) of MidFirst Bank's filing of the Motion for Relief from Stay can be found in the 2nd quote above, and attached below this OP as "14.pdf", "14-1.pdf", "14-2.pdf", "15.pdf" and "15-1.pdf".

6. Rekieta Law ran through MidFirst Bank's motion as an update to DSP's bankruptcy filing:



-UPDATE- March 26-April 1, 2020

The 341 Meeting of Creditors took place and was streamed live on Twitch and recorded. The court released their recording as well within a week:

Useful links:
- Kiwi Farms thread dedicated to discussion on the 341 Meeting of Creditor('s recording)
- the Twitch channel that originally live-streamed the meeting

DSP was supposed to be in the 10:30 AM batch of debtors, but was pushed all the way back into another time slot by the trustee because she didn't want to, and I quote, "delay other cases". And boy, what a meeting it was... While most 341 meetings are over within a matter of minutes, DSP's 341 meeting took over 40(!) minutes. Someone claiming to be a debt buyer who bought (some of) DSP's Citibank credit debt streamed the complete meeting on Twitch.

Full recording of the meeting (a video with just the audio so I could embed it here):

















An audio-only (.mp3) hard copy of the recording is attached down below as "341 Meeting recording audio only".


On March 28, 2020, Rekieta Law listened to the 341 Meeting's recording and offered his insights:


TL;DR "On a scale of 1-10, how bad did this call go for DSP?" Rekieta Law says: "7/10, could've gone worse. But it really is going to depend on how much the trustee is going to dig into it, or if the creditors more aware".

On April 1, 2020, the official courtroom recording of the meeting's call was released:

View attachment 1211510

Here is the courtroom's audio copy of the hearing.
Now with 100% more note-taking.

Embedded:

















A backup copy has been added as an attachment below the OP, named "341 Meeting of Creditors (official courtroom recording).mp4".


-UPDATE- March 30-31, 2020

An update from MidFirst Bank:

Something was added tonight:

Receipt of filing fee for Motion for Relief from Stay( 20-10323-TWD) [motion,185] ( 181.00). Receipt number A26343134. Fee amount $ 181.00. (U.S. Treasury)

Confirmation from user actually:

Pretty sure that's MidFirst paying the filing fee for their motion. @AnOminous, @Beetus Knuckles, @SoapQueen1, can one of you confirm?

Edit: https://www.wawb.uscourts.gov/filing-fees Confirmed here. $181 for filing a motion for relief of stay. Note as well the date on it, which is the same as the date the actual motion (and related docs) were filed by Lance Olsen.

After fighting with a "Detractor" on Twitter, claiming that none of what came out during the bankruptcy call "is bad for me at all", Phil's case was updated. He is now being investigated by the trustee:

1585774874953.png
(source = https://tw.tinf.io/ChrisLoneWolf95/status/1244787025934344195)

1585774964193.png
(https://tw.tinf.io/TheyCallMeDSP/status/1244788669585616896)

From @PutridElephant
1585775188008.png

(link = https://www.docketbird.com/court-cases/Philip-P-Burnell/wawb-2:2020-bk-10323)


-UPDATE- April 11, 2020

The deadline for the Chapter 7 Trustees Initial Report (April 14), Citibank is trying to make sure they can collect the debt even if the bankruptcy is approved and DSP has unpaid taxes amounting to $300:

Deadline:
Here are some deadlines. 10 days from 3/31/2020 which I believe is 4/14.
View attachment 1224182

445.jpg


Citibank:
I was going to sperg about what I thought the 3/31 10 days shit meant, but then Mr. Huth blessed us with an update: Citibank appears to be fighting the bankruptcy on top of unpaid taxes to the State Department of Revenue in the combined amount of $38,308.22.

Docs: https://mega.nz/file/MAdxWQJJ#VAOoViuY2hqcgKbjCYVLj32SY6augvFHXTHwttuLmL4

It means they're declaring it severely (> 6 months) delinquent which looks worse than regular delinquency on his credit report. It also lets them write it off as uncollectable for tax purposes while still letting them pursue him for the full amount. Apart from fucking his credit this means they probably intend to use the tax benefits of a charge off to pay for the costs of pursuing him.

Citibank is trying to argue the debt is non-dischargeable in Chapter 7 bankruptcy and that they should have the right to collect the full $38k even if it does go through. The chargeoff is just the icing on top of the sundae.


Unpaid taxes:
So there's some additional documents that MrHuth posted from the WA State Department of Revenue. Seems Phil failed to pay some type of "excise tax" from July 1 to Sept 30 of 2019 in the amount of $312.68. The documents from Dept. of Revenue were apparently filed February 21st, 2020. Note that there is an amended claim, so there's 4 documents total from WA Dept. of Revenue and 3 from Citibank attached.

I'm also attaching the 3 Citibank documents. Could @SoapQueen1, @Beetus Knuckles, @AnOminous, @architect, and any of our other experts comment on the WA State filing? Side note: the fact that he owed ~$311 for 2 months of state tax suggests that his gross income for 2019 (assuming those months are reasonably similar to the other months) was ~$124,000, which is perfectly in line with what we've estimated before.

Math:

$310.23 / 2 months = $155.12 state B&O tax per month * 12 months = $1861.38 for 2019 / 0.015 (1.5% B&O tax) = $124,092 of gross income.

Alright, so I fucked up a bit here. That $310 back tax is from July to Sept. 3 months, not 2. So it works out to $100 or so a month, which gives gross income of $82k or so.

Thing is, that's well below the annual income I came up with, well below the income @SoapQueen1 came up with based on his owed taxes, and given that my monthly estimates matched his reported monthly income well, I don't think I got that wrong. This suggests that either he made only a partial payment or that the amount was based on estimated income or something.

Regardless, it's money he should have been able to pay, especially given that the Jasper begathon happened at the start of August and netted $2000.



Corresponding documents have been added as .pdf attachments (Citibank 1-3, Taxes Amend 1 & 2 and Taxes unamend 1 & 2).


-UPDATE- April 13, 2020

It was confirmed that DSP's bankruptcy filing has been turned into a so-called 'asset case':
I gave the clerk a call asked whether or not Nancy had filed her initial report and she said the case has in fact been turned into an asset case and what's listed in the text-only entry on PACER (that the trustee is investigating the existence of other assets).

I infer we will get another docket entry when Nancy files a report containing the results of her investigation. It may not be available for download online, I haven't seen an example asset Chapter 7 case to know one way or the other.


What is a Chapter 7 asset case?

If you file Chapter 7 bankruptcy and are in possession of assets that are not exempt, the trustee is empowered to sell them and distribute the money among the creditors.


-UPDATE- April 24, 2020

The bankruptcy petition was amended to include personal assets previously unlisted, valued at $2700. These were then put on the exemptions list so they can't be sold by the trustee to pay off creditors, if the bankruptcy is approved.


He added $2500 worth of collectibles, Jasper, and $1500 worth of "electronics used for business"

He also added $200 in personal electronics.
Just for quicker access for anyone reading, here's the major changes to the filing. Note that he did NOT add the consoles suddenly--the description of the business assets was made more descriptive:

1587771906760.png

1587773614936.png

1587771936290.png

1587772044090.png

1587773640387.png

1587772068517.png

1587772081509.png



amended property cat personal electronics collectibles.png amended property cat personal electronics collectibles_exemption.png

The amended section has been attached below as 'Bankruptcy Petition (amended property and exemptions April 24, 2020).pdf'.


-UPDATE- May 6, 2020

Somehow hell has frozen over, because P.P. Burnell was discharged of most debts.
Order of discharge page 1.PNG Order of discharge page 2.PNG

The corresponding document has been attached below as 'Debtor discharge (20-10323-TWD-24).pdf'.
 

Attachments

  • 09 - 341 Notice Prepare.pdf
    35 KB · Views: 232
  • Bankruptcy Petition.pdf
    816.1 KB · Views: 284
  • CounselingCertificate.pdf
    29.2 KB · Views: 163
  • Filing_Fee_installment.pdf
    36.7 KB · Views: 173
  • Monthly Income and Expenses Statement.pdf
    83.4 KB · Views: 264
  • Phil's Property Detail Report.pdf
    92 KB · Views: 275
  • 341 Meeting to be held over telephone at March 26 2020.pdf
    136.4 KB · Views: 142
  • 14.pdf
    92 KB · Views: 143
  • 14-1.pdf
    38.2 KB · Views: 122
  • 14-2.pdf
    39.8 KB · Views: 134
  • 15.pdf
    139.8 KB · Views: 157
  • 15-1.pdf
    1.7 MB · Views: 155
  • 341 Meeting recording audio only.mp3
    37.7 MB · Views: 179
  • Citibank 1.pdf
    322.3 KB · Views: 130
  • Citibank 2.pdf
    322.3 KB · Views: 113
  • Citibank 3.pdf
    322.3 KB · Views: 134
  • taxes Amend 1.pdf
    51 KB · Views: 147
  • taxes Amend 2.pdf
    236.5 KB · Views: 131
  • taxes unamend 1.pdf
    51 KB · Views: 122
  • taxes unamend 2.pdf
    76.5 KB · Views: 130
  • Bankruptcy Petition (amended property and exemptions April 24, 2020).pdf
    154.4 KB · Views: 134
  • Debtor discharge (20-10323-TWD-24).pdf
    31.2 KB · Views: 120
Last edited:

RemoveKebab

Ssssshhhhh I said ssssshhhhhhh. Tee Hee!
True & Honest Fan
kiwifarms.net
Wait, so Bankruptcy doesn't work the way Phil thinks it does right? He doesn't just get to throw away his debt and call it all good in one court proceeding right?

Also he'll have to prove he was broke right? They'll look in to his spending and finances right?
Helpful information DOOD

Chapter 11 vs. Chapter 7 Bankruptcy
DiffenFinancePersonal Finance
Depending on the type, or "chapter," of bankruptcy, debts are treated differently. In Chapter 11 bankruptcy, debts are restructured in a way that debt repayment becomes more achievable. In Chapter 7 bankruptcy, which is the most common form of bankruptcy, many debts are forgiven, and a variety of personal assets are sold — liquidated — to repay as many remaining debts as possible. In general, Chapter 11 bankruptcy is utilized by corporations and other business owners, while Chapter 7 bankruptcy is favored by individuals.
There are 4 types of bankruptcy filings in the Federal Bankruptcy Code (Title 11 of the United States Code):
  • Chapter 7 - Liquidation
  • Chapter 11 - Reorganization (or Rehabilitation bankruptcy)
  • Chapter 12 - Adjustment of Debts of a Family Farmer with Regular Annual Income
  • Chapter 13 - Adjustment of Debts of an Individual with Regular Income
The main difference between Chapter 7 and Chapter 11 bankruptcy is that under a Chapter 7 bankruptcy filing, the debtor's assets are sold off to pay the lenders (creditors) whereas in Chapter 11, the debtor negotiates with creditors to alter the terms of the loan without having to liquidate (sell off) assets.
Comparison chart
Differences — Similarities —
Chapter 11 Bankruptcy versus Chapter 7 Bankruptcy comparison chart
Edit this comparison chart Chapter 11 BankruptcyChapter 7 Bankruptcy
  • current rating is 3.09/5
  • 1
  • 2
  • 3
  • 4
  • 5
(82 ratings)
  • current rating is 3.09/5
  • 1
  • 2
  • 3
  • 4
  • 5
(101 ratings)
Known asReorganization or Rehabilitation BankruptcyLiquidation Bankruptcy
Debtor's assets sold (liquidated)NoYes (certain assets are exempt; so they are not sold)
Trustee appointedYesYes
Role of trusteeTo work with the debtor to develop a repayment plan for all outstanding loansTo oversee the securing of the debtor's assets, the liquidation (sale) of these assets and the repayment of creditors in the order of priority (secured debts repaid first)
Debt forgivenessNo. Terms of the loan are changed.Yes. Debt may be forgiven to the extent that sale of assets does not cover all loans.
Entities allowed to fileBusinesses, individuals, married couplesBusinesses, individuals, married couples
 

DZoomer

kiwifarms.net
I don't understand how he thinks he can just declare bankruptcy and all his debts will disappear.

He makes a lot of money. He has the means to pay off his debts. He can sell his WAkhando, pay off his debts and buy a smaller house.

I mean, maybe I'm the one who doesn't understand how the law works in the US. But that kind of thing wouldn't happen the way DSP thinks it is going to happen here in my country. Can't declare bankruptcy when he is capable of paying off all his debts.
 

TheKatIsNowGone

Praise the Sun!
kiwifarms.net
Helpful information DOOD

Chapter 11 vs. Chapter 7 Bankruptcy
DiffenFinancePersonal Finance
Depending on the type, or "chapter," of bankruptcy, debts are treated differently. In Chapter 11 bankruptcy, debts are restructured in a way that debt repayment becomes more achievable. In Chapter 7 bankruptcy, which is the most common form of bankruptcy, many debts are forgiven, and a variety of personal assets are sold — liquidated — to repay as many remaining debts as possible. In general, Chapter 11 bankruptcy is utilized by corporations and other business owners, while Chapter 7 bankruptcy is favored by individuals.
There are 4 types of bankruptcy filings in the Federal Bankruptcy Code (Title 11 of the United States Code):
  • Chapter 7 - Liquidation
  • Chapter 11 - Reorganization (or Rehabilitation bankruptcy)
  • Chapter 12 - Adjustment of Debts of a Family Farmer with Regular Annual Income
  • Chapter 13 - Adjustment of Debts of an Individual with Regular Income
The main difference between Chapter 7 and Chapter 11 bankruptcy is that under a Chapter 7 bankruptcy filing, the debtor's assets are sold off to pay the lenders (creditors) whereas in Chapter 11, the debtor negotiates with creditors to alter the terms of the loan without having to liquidate (sell off) assets.
Comparison chart
Differences — Similarities —
Chapter 11 Bankruptcy versus Chapter 7 Bankruptcy comparison chart
Edit this comparison chart Chapter 11 BankruptcyChapter 7 Bankruptcy
  • current rating is 3.09/5
  • 1
  • 2
  • 3
  • 4
  • 5
(82 ratings)
  • current rating is 3.09/5
  • 1
  • 2
  • 3
  • 4
  • 5
(101 ratings)
Known asReorganization or Rehabilitation BankruptcyLiquidation Bankruptcy
Debtor's assets sold (liquidated)NoYes (certain assets are exempt; so they are not sold)
Trustee appointedYesYes
Role of trusteeTo work with the debtor to develop a repayment plan for all outstanding loansTo oversee the securing of the debtor's assets, the liquidation (sale) of these assets and the repayment of creditors in the order of priority (secured debts repaid first)
Debt forgivenessNo. Terms of the loan are changed.Yes. Debt may be forgiven to the extent that sale of assets does not cover all loans.
Entities allowed to fileBusinesses, individuals, married couplesBusinesses, individuals, married couples
Phew, for a second I was under the pignosis. This is going to get so good.
 

tomstone

kiwifarms.net
Helpful information DOOD

Chapter 11 vs. Chapter 7 Bankruptcy
DiffenFinancePersonal Finance
Depending on the type, or "chapter," of bankruptcy, debts are treated differently. In Chapter 11 bankruptcy, debts are restructured in a way that debt repayment becomes more achievable. In Chapter 7 bankruptcy, which is the most common form of bankruptcy, many debts are forgiven, and a variety of personal assets are sold — liquidated — to repay as many remaining debts as possible. In general, Chapter 11 bankruptcy is utilized by corporations and other business owners, while Chapter 7 bankruptcy is favored by individuals.
There are 4 types of bankruptcy filings in the Federal Bankruptcy Code (Title 11 of the United States Code):
  • Chapter 7 - Liquidation
  • Chapter 11 - Reorganization (or Rehabilitation bankruptcy)
  • Chapter 12 - Adjustment of Debts of a Family Farmer with Regular Annual Income
  • Chapter 13 - Adjustment of Debts of an Individual with Regular Income
The main difference between Chapter 7 and Chapter 11 bankruptcy is that under a Chapter 7 bankruptcy filing, the debtor's assets are sold off to pay the lenders (creditors) whereas in Chapter 11, the debtor negotiates with creditors to alter the terms of the loan without having to liquidate (sell off) assets.
Comparison chart
Differences — Similarities —
Chapter 11 Bankruptcy versus Chapter 7 Bankruptcy comparison chart
Edit this comparison chart Chapter 11 BankruptcyChapter 7 Bankruptcy
  • current rating is 3.09/5
  • 1
  • 2
  • 3
  • 4
  • 5
(82 ratings)
  • current rating is 3.09/5
  • 1
  • 2
  • 3
  • 4
  • 5
(101 ratings)
Known asReorganization or Rehabilitation BankruptcyLiquidation Bankruptcy
Debtor's assets sold (liquidated)NoYes (certain assets are exempt; so they are not sold)
Trustee appointedYesYes
Role of trusteeTo work with the debtor to develop a repayment plan for all outstanding loansTo oversee the securing of the debtor's assets, the liquidation (sale) of these assets and the repayment of creditors in the order of priority (secured debts repaid first)
Debt forgivenessNo. Terms of the loan are changed.Yes. Debt may be forgiven to the extent that sale of assets does not cover all loans.
Entities allowed to fileBusinesses, individuals, married couplesBusinesses, individuals, married couples
lets hope for the lucky 7
 
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