Personal Bankruptcy

In financial terms, what is the role of a debtor?

• A person who lends money.

• A person who borrows money and owes it back.

• A person who manages a bank.

• A person who collects debts for others.

What is a key characteristic of a Chapter 7 "straight bankruptcy" in the United States?

• It allows debtors to keep all their assets while restructuring payments.

• It results in the debtor being imprisoned until debts are paid.

• It involves selling most of the debtor's assets to pay creditors, after which remaining debts are discharged.

• It only applies to corporations, not individuals.

What is a characteristic of Chapter 7 bankruptcy?

• It involves a repayment plan over 3-5 years.

• It typically remains on a credit report for 10 years.

• It can forgive student loans and child support.

• It is primarily for businesses.

Which of the following types of debt cannot be forgiven in a Chapter 7 bankruptcy?

• Credit card loans

• Medical bills

• Student loans

• Personal loans

What is the primary purpose of Chapter 13 bankruptcy?

• To completely eliminate all debts immediately.

• To reorganize debts into a manageable repayment plan.

• To allow businesses to restructure their finances.

• To provide immediate financial relief without any long-term credit impact.

How long does a Chapter 13 bankruptcy typically remain on a credit report from the time of filing?

• 3 to 5 years

• 7 years

• 10 years

• 15 years