https://www.khanacademy.org/economics-finance-domain/core-finance/interest-tutorial/personal-bankruptcy-tut/v/personal-bankruptcy-chapters-7-and-13 2020-06-23T07:22:43Z Personal bankruptcy: Chapters 7 and 13 Bankruptcy is the situation is when a person or other economic agent that owes more money than they will be able to pay back. In the United States, people who declare personal bankruptcy can do so under two provisions of the United States Bankruptcy Code, Chapter 7 or Chapter 13. Under the provisions of Chapter 13, some kinds of debt are restructured so that at least some of the debts are repaid. However under Chapter 7, some kind of debts are completely eliminated. In this video, we explore some of the differences between Chapter 7 or Chapter 13 bankruptcies, and some of the considerations when people consider these forms of bankruptcy need to think about. Sal Khan video https://cdn.kastatic.org/googleusercontent/MKQfbzmaueCrcnZa7z9hbRwhUK5ZW4Hvu09TwqyLkUhggL0ZOUcl-krvTjT24OmzFqq7PpOm2tQtG7DwRrxnlcMt Personal bankruptcy: Chapters 7 and 13 Bankruptcy is the situation is when a person or other economic agent that owes more money than they will be able to pay back. In the United States, people who declare personal bankruptcy can do so under two provisions of the United States Bankruptcy Code, Chapter 7 or Chapter 13. Under the provisions of Chapter 13, some kinds of debt are restructured so that at least some of the debts are repaid. However under Chapter 7, some kind of debts are completely eliminated. In this video, we explore some of the differences between Chapter 7 or Chapter 13 bankruptcies, and some of the considerations when people consider these forms of bankruptcy need to think about. https://cdn.kastatic.org/ka-youtube-converted/H3tg4bH5JuY.mp4/H3tg4bH5JuY.mp4 784 Bankruptcy https://www.khanacademy.org/college-careers-more/financial-literacy/xa6995ea67a8e9fdd:loans-and-debt/xa6995ea67a8e9fdd:bankruptcy/a/bankruptcy 2025-07-17T20:32:43.972177035Z Bankruptcy Bankruptcy is a legal process designed to help people or businesses who can't pay their bills. It's a way of getting a fresh start financially. In the United States, there are two main types of bankruptcy: Chapter 7 and Chapter 13. Each type of bankruptcy has different rules and requirements. article https://www.khanacademy.org/college-careers-more/financial-literacy/xa6995ea67a8e9fdd:loans-and-debt/xa6995ea67a8e9fdd:bankruptcy/e/bankruptcy 2024-08-22T17:00:29.890234127Z Bankruptcy Practice your understanding of bankruptcy, factors that cause it, and chapters 7 and 13 of bankruptcy. Elvira Valdez exercise https://www.khanacademy.org/college-careers-more/financial-literacy/xa6995ea67a8e9fdd:loans-and-debt/xa6995ea67a8e9fdd:bankruptcy/v/bankruptcy-impact 2026-06-26T22:00:50.551247157Z Bankruptcy impact While Chapter 7 and Chapter 13 bankruptcy can help resolve severe financial situations, neither option is easy nor will they cancel all types of loans. Going through either process carries lasting downsides, as it negatively impacts your credit rating for seven to ten years and can severely restrict your ability to secure loans, rent apartments, or obtain certain jobs. Sal Khan video https://cdn.kastatic.org/ka_thumbnails_cache/10872f06-15c5-4c3b-a097-969fe926e1f4_1280_720_base.png Bankruptcy impact While Chapter 7 and Chapter 13 bankruptcy can help resolve severe financial situations, neither option is easy nor will they cancel all types of loans. Going through either process carries lasting downsides, as it negatively impacts your credit rating for seven to ten years and can severely restrict your ability to secure loans, rent apartments, or obtain certain jobs. https://cdn.kastatic.org/ka-youtube-converted/p6zMRL-Pl8c.mp4/p6zMRL-Pl8c.mp4 160 Bankruptcy https://www.khanacademy.org/college-careers-more/financial-literacy/xa6995ea67a8e9fdd:loans-and-debt/xa6995ea67a8e9fdd:bankruptcy/a/understanding-bankruptcy 2026-04-04T02:06:38.980527203Z Understanding bankruptcy A bankruptcy stays on your credit report for a long time: up to 10 years for Chapter 7 and 7 years for Chapter 13. That means bankruptcy can affect many of the normal life moments that come up during those 7 to 10 years. In that time, you’ll probably need to apply for something important, like a car loan, a mortgage, a credit card, an apartment, or even a new job. When lenders, landlords, or employers check your credit and see a bankruptcy, they may treat you as a higher risk. That can lead to denials, bigger deposits, or much higher costs. article https://www.khanacademy.org/college-careers-more/financial-literacy/xa6995ea67a8e9fdd:loans-and-debt/xa6995ea67a8e9fdd:bankruptcy/e/how-bankruptcy-works 2026-07-06T04:50:55.94861601Z How bankruptcy works Practice understanding how bankruptcy affects credit and borrowing, what happens when you file, and alternatives that may help manage debt. Shannah Game exercise