If you plan on filing personal bankruptcy in the United States, you are most likely to file either Chapter 7 or Chapter 13. The difference between the two types of bankruptcy is simple. Chapter 7 bankruptcy is often called "straight bankruptcy." It is a direct means of relieving the debtor of his or her financial debt while providing creditors with their due payments for work or services rendered. Under Chapter 7, the court will appoint a trustee who will liquidate all your nonexempt property. You will get to retain any exempt property. After the process, the debtor receives a discharge of all dischargeable debts. This usually takes 4 months to achieve. Since many who apply successfully for Chapter 7 bankruptcy have no assets, Chapter 7 will grant them the chance at a new start. If, when filing personal bankruptcy, you are placed under Chapter 11, you face a different situation. Chapter 11 is often called the "wage earner's plan." This type entails the preparation, acceptance and implementation of a 3 to 5 year financial plan. The plan provides specific and viable information on how the debtor will repay the creditors. The plan must be approved by the court and the trustee.