What is the difference between chapter 7, chapter 13, and chapter 11 bankruptcy?

A chapter 7 bankruptcy is termed “liquidation” or straight bankruptcy. A debtor seeks to discharge all of his or her debt without paying any money back, though might be required to give up some assets he or she owns at the time of filing. A chapter 13 bankruptcy is termed “reorganization.” It allows debtors to discharge most or all of their debt while retaining all assets, by proposing a 3-5 year payment plan. Chapter 13 bankruptcy has a lot more options regarding secured debts than chapter 7.

A chapter 11 is reserved mostly for business reorganizations, though individuals seeking chapter 13 protection may be forced into a chapter 11 if they exceed the secured or unsecured debt ceilings in a chapter 13.