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Chapter 7 is known as “liquidation bankruptcy.” It is the quickest, simplest, and most common type of bankruptcy. While nationwide bankruptcy filings in 2023 were up 16.8%, the ratio of Chapter 7 filings among all bankruptcies held steady at 60%, according to the United States Courts.

A chapter 7 case begins with the debtor filing a petition with the bankruptcy court serving the area where the individual lives or where the business debtor is organized or has its principal place of business or principal assets.