Straight Bankruptcy Law and Legal Definition

Straight Bankruptcy is a term used to describe a bankruptcy case filed under chapter 7 of the Bankruptcy Code. Chapter 7 of the Bankruptcy Code is the most common type of bankruptcy proceeding. It allows a trustee to collect and liquidate a debtor's nonexempt property, either voluntarily or by court order, to satisfy creditors. An individual debtor who undergoes this type of liquidation usually gets a fresh financial start by receiving a discharge of all debts. This is also termed Liquidation Bankruptcy.