Types

• Straight bankruptcy is technically called a Chapter 7 bankruptcy, which means all of the debtor's debts are wiped out, with some exceptions, such as student loans, taxes or child support. Most of the debtor's assets are sold by the court trustee to satisfy as much of the debt as possible. Certain assets can be exempt, such as a car to get to work, a home or personal household items. A straight bankruptcy differs from a Chapter 11 bankruptcy in which the debtor promises to repay a portion of the debt.
  
  

Benefits

• The benefit of filing a straight or Chapter 7 bankruptcy is that the debtor can start fresh and get out from under their debt, without having to repay the debt. A straight bankruptcy filing will also stop foreclosures, garnishments and creditor harassment.
  
  

Disadvantages

• The disadvantages to filing a straight or Chapter 7 bankruptcy is that some of the stays are only temporary, such as a foreclosure, stay. Once a straight bankruptcy is filed, ito keep a home, payment arrangements have to be made with the mortgage company and late fees will still apply.
  
  Another disadvantage to filing for a straight bankruptcy is that it will affect your credit for up to 10 years and can keep you from getting certain jobs, leases or promotions.