A Chapter 7 & 13 Bankruptcy Comparison for You

Find Out If Filing Bankruptcy Is Right for You

We here at Chapter7.Me aim to provide you with comprehensive information about bankruptcy law. When you’re facing difficult financial problems, it can be difficult in figuring out if bankruptcy is right for you; that’s why we’ve provided you with the following Chapter 7 and Chapter 13 comparison.

You should also consider that filing bankruptcy might not be the right choice for you. Check out Chapter7.Me’s section on other bankruptcy alternatives for more ideas on how to relieve your debt, or fill out our free bankruptcy evaluation form or call 888-632-0501 to discuss your situation with a bankruptcy lawyer.

The Main Differences between Chapter 7 Bankruptcy and Chapter 13 Bankruptcy

Chapter 7 and 13 bankruptcy offer you different ways to take control of your finances.

Check out the below information to learn how Chapter 7 or 13 bankruptcy may help you regain control of your finances via different means.

If you need additional advice, a bankruptcy attorney may be a good resource.

You may want to consider filing Chapter 7 bankruptcy if you:

• have minimal property except for the basic necessities like furniture and clothing;
• rent your home or have little equity in your home;
• have little money at the end of each month after paying basic living expenses;
• have a lot of unsecured debt like credit cards or medical bills;
• have trouble making ends meet with your income;
• make less than your state’s median income level; and/or
• make minimal or no income.

Chapter 7 bankruptcy can be a good option for people that meet the criteria listed above. Under Chapter 7 bankruptcy protection, most—if not all—unsecured debt is eliminated. When the Chapter 7 bankruptcy is complete, the bankruptcy filer is no longer required to pay back those discharged debts.

Creditors are silenced under Chapter 7 bankruptcy thanks to the Chapter 7 automatic stay. An automatic stay is a court order that legally prohibits creditors from trying to collect on debts.

The Chapter 7 bankruptcy process also moves quickly. You could potentially receive your debt discharge within a few months of filing Chapter 7 bankruptcy. For more information on Chapter 7 bankruptcy, visit our Chapter 7 Bankruptcy Basics section.

You may want to consider filing Chapter 13 bankruptcy if you:

• own a home where you have significant equity and/or you own other significant assets;
• are looking for additional time to pay your debts;
• are looking to prevent or stop a mortgage foreclosure;
• want co-signers of your debt to be protected;
• have unsecured debts below $360,475 or secured debts that are less than $1,081,400;
• have regular income; and/or
• can pay your basic living expenses but are having a hard time keeping up with scheduled debt payments.

If any of the above items sound familiar to you, Chapter 13 bankruptcy may be a better alternative than Chapter 7 bankruptcy.

Chapter 13 bankruptcy allows you to get on a debt repayment plan where you’ll make monthly payments in an amount your bankruptcy trustee has worked out with your creditors. A typical Chapter 13 bankruptcy debt repayment plan is between three and five years long.

With Chapter 13 bankruptcy, filers receive the protection of a Chapter 13 automatic stay, which silences creditors. The automatic stay is a court order that is designed to stop collection efforts.

For more information on Chapter 13 bankruptcy, visit our Chapter 13 bankruptcy information section or check out our sister site, Chapter13.Me.

Need More Advice about Filing Bankruptcy to Take Control of Your Life?

Remember, determining whether Chapter 7 bankruptcy or Chapter 13 bankruptcy makes more sense to you may not be as clear-cut as you think.

If you’d like legal advice about what may be the best action for you, you can connect to a local bankruptcy lawyer by filling out Chapter7.Me’s free bankruptcy evaluation form or by calling 1 (888) 632-0501.