Excessive credit card usage is causing many people to consider bankruptcy. The increased focus on bankruptcy has not been limited to individuals. In March of this year, the American Bankruptcy Institute added the Dot-Corn Death Watch to its home page on the Internet. The site keeps track of the latest bankruptcy trends, with a daily tracking of the dead and dying dot-corns. Despite the dramatic increase in bankruptcy filings, few know much about the bankruptcy process.
Bankruptcy is a confusing area.
The key to understanding the bankruptcy process begins with the United States Bankruptcy Code, which is by the numbers. The Code is an expansive series of federal statutes that are interpreted by bankruptcy courts. The Code provides for different types of bankruptcies, as defined by various Chapters of the Bankruptcy Code. The most common bankruptcies are under Chapter 7, Chapter 11, and Chapter 13 of the Bankruptcy Code. Chapter 7 bankruptcy is frequently referred to as 1iquidation proceeding.