Definition of Closed Bankruptcy

Types of Personal Bankruptcy

• The two types of personal bankruptcy, Chapter 7 and Chapter 13, are very different. Chapter 7 bankruptcy liquidates your estate in order to pay off creditors with the proceeds. Chapter 13 arranges a repayment plan over a three to five year period where a debtor or joint debtors make payments to a trustee who uses the money to pay off creditors.
  
  

Filing for Bankruptcy

• It helps to consult an experienced bankruptcy attorney, he or she can give you advice on what chapter of bankruptcy to file for and how to fill out the necessary paperwork. They can also file your bankruptcy petition with the bankruptcy court.
  
  

Closing your Bankruptcy Case

• There are two ways a bankruptcy can end, either through discharge or dismissal. A discharge means that the case has ended successfully. If your bankruptcy case is discharged, all debts covered by the bankruptcy plan have been discharged and your slate has been "wiped clean" of debt. If your case is dismissed, it means that your bankruptcy case has been thrown out of bankruptcy court.
  
  

Closing your Bankruptcy Case with a Discharge

• A discharge is the way you want to close your bankruptcy case. In order to close your bankruptcy case successfully, you must complete the terms of your bankruptcy plan as confirmed by the bankruptcy court. If a Chapter 7 plan, you must comply with all liquidation of assets, if a Chapter 13 case, complete making your plan payments to the Trustee.
  
  

What Does a Closed Bankruptcy Case Mean?

• A closed bankruptcy means that the case is over and is out of the court system. If your case has been dismissed, creditors can now start initiating collection efforts on any outstanding debts. If your case has been discharged, all creditors included in the plan will be paid off and unable to collect any further on any debts.