Chapter 7 v. Chapter 13

What are the differences between Chapter 7 and Chapter 13 Bankruptcy? The main difference is that in a Chapter 7 you do not pay back any of your debts except for things that you would like to keep.

In Chapter 7 you can keep your home and vehicle if you are up to date on your payments and do not have too much equity in your property. All of your unsecured debt would be discharged through the case and you would no longer be responsible for these debts.

Chapter 13 is designed to help you possibly save your home from foreclosure or your vehicle from repossession. You would pay a percentage of your unsecured debts. Chapter 13 is a 3 to 5 year process which allows you to pay back a percentage of your debts while most interest and fees will stop. This will also stop a foreclosure and allow you to pay the amount you are behind over the 3 to 5 year period.

Both chapters can be beneficial under the right circumstances. Contact our office today for your free consultation to discuss your individual situation.