The three most common types of bankruptcy are:
Chapter 7 Arizona bankruptcy (commonly known as liquidation);
Chapter 13 Arizona bankruptcy (a payment plan typically over 3 to 5 years, sometimes called consolidation bankruptcy); and
Chapter 11 Arizona bankruptcy (a more complex reorganization used primarily by business debtors, but sometimes by individuals with substantial debts and assets).
Consumers typically file chapter 7 or chapter 13. Both provide for some possible payments to creditors, a discharge for you and supervision by a trustee. In a chapter 7 case, you turn over non-exempt property in return for a discharge of most of your debts. The trustee sells any non-exempt property and pays your creditors. In a chapter 13 case, you keep your property but must commit to a three to five-year repayment plan. These plan payments are calculated using a variety of factors more fully discussed on our chapter 13 Arizona bankruptcy information page. You then obtain a discharge of most of the debts not paid in the plan.