Most Chapter 7 applicants don't even set foot in court and only see the judge if there are objections to the bankruptcy plan. Different Types of Bankruptcy If you were to ask an attorney, "What is bankruptcy?
Chapter 13 debtors typically appear in court just once, at the bankruptcy plan confirmation hearing. " you would probably be asked whether you are a business or an individual, the status of your debts, and other questions to help narrow down the definition.
Major changes to the Bankruptcy Code in 2005 included the requirement of a "means test" to determine eligibility for personal bankruptcy under Chapter 7.
The test determines whether or not the debtor has too much income for this type of filing.
short-term working capital loan that is repaid from the liquidation of inventories.
It is used to finance seasonal borrowing needs of a business needing capital to acquire inventory, by a farmer or other business needing bank financing to buy seed, fertilizer, and other supplies.
Explanation: You normally talk about "self-liquidating loans", but the term posted is used. For example, an appointed trustee carries out the administrative duties of Chapter 7, Chapter 13, and other types of bankruptcy cases. The bankruptcy discharge, a court order releasing the debtor from personal liability for certain debts, is the main way this is accomplished.The debtor actually has very little interaction with the bankruptcy judge. The discharge also prohibits creditors or collections agencies from communicating with debtors.The borrower repays the loan as inventory is converted into cash or a farm crop is sold.Early in the twentieth century, commercial banks made only short-term loans, and self-liquidating loans were a common variety.Most people have heard the term "bankruptcy" and understand that it has something to do with being broke.