Bankruptcy is a legal process by which certain debts are forgiven while also allowing creditors the opportunity to obtain repayment based on the available assets of a business or individual. Upon the successful completion of a bankruptcy, a debtor is relieved of the debt obligations incurred prior to filing for bankruptcy.

As opposed to an Assignment for the Benefit of Creditors, all bankruptcies are handled on a Federal level. A bankruptcy judge oversees the case and the case may be handled by a trustee, which represents the debtor.

Chapter 11 “reorganization” and Chapter 7 “liquidation” are two commonly used forms of bankruptcy under the Bankruptcy Code.

Chapter 11 "Reorganizations"

  • Usually utilized by corporations, partnerships, Limited Liability Partnerships, or high net worth individuals

  • Debts are restructured to create an achievable repayment plan

Chapter 7 "Liquidations"

  • Often used by individuals and corporations

  • Debts are discharged subject to the filer’s eligibility and the type of debt

T: 310.601-1746

F: 310.820.9979


© 2020 CMBG Advisors, Inc.

12400 Wilshire Blvd #1180

 Los Angeles, CA 90025