Should I File Chapter 7 or Chapter 13 Bankruptcy?

Ch7 vs Ch13 Bankruptcy

There are two different types of bankruptcy that individuals can file: Chapter 7 and Chapter 13. Both have their own pros and cons, and it’s important to understand the difference before you decide which one is right for you. Chapter 7 bankruptcy allows you to discharge most of your debts, but it also comes with some drawbacks.

For example, you may lose certain assets, and it can stay on your credit report for up to 10 years. On the other hand, Chapter 13 bankruptcy lets you keep most of your assets and only requires a 3-5 year repayment plan. It also doesn’t have as big of an impact on your credit score.

So which one should you choose? It depends on your unique financial situation. Consult with a bankruptcy attorney to explore all of your options and find the best solution for YOU.

Who Is Chapter 7 For?

Ch7 vs Ch13 Bankruptcy LawChapter 7 bankruptcy is better for those who have little to no income and are unable to repay their debts.

For those facing insurmountable debt who lack reliable sources of income to repay their debts, Chapter 7 bankruptcy can be a beneficial and viable option. In these situations, it allows individuals to discharge certain types of unsecured debt while avoiding the prolonged litigation associated with Chapter 13 bankruptcies.

Additionally, it is often quicker and more inexpensive which can prove advantageous for those with limited resources. Therefore, if you are in need of financial relief from overwhelming debt, a Chapter 7 bankruptcy may be the most reasonable options for you to provide the resolution necessary.

Who Is Chapter 13 best for?

Chapter 13 bankruptcy is better for those who have a regular income and can repay some of their debts over time.

Chapter 13 bankruptcy is a great option for those who have a steady income and want to pay back part of their debts over a period of time. It allows debtors to reorganize their finances, creating a repayment plan that works for them and manageable with their lifestyle.

Additionally, it can stop foreclosure, wage garnishment and similar legal actions taken against borrowers by creditors. When considering the different solutions for managing one’s debt, Chapter 13 bankruptcy has many advantages due to its structure that allow debtors to reorganize their financial situation in order to repay some of their debts over time without losing all of their assets.

What’s The Difference Between Chapter 7 vs Chapter 13?

Both types of bankruptcy will help you get rid of your debt, but they work in different ways.

Both Chapter 7 and Chapter 13 Bankruptcies can provide viable solutions to getting rid of your unmanageable debt. Chapter 7 is the more straightforward option, offering an immediate discharge of most debt. On the other hand, Chapter 13 allows for payments over a period of three-to-five years, allowing you to keep some of your property and stay in business throughout the term.

When considering which course of action is best suited for you and your situation, it’s important to consult with an experienced bankruptcy attorney who can review the facts and advise you on a successful outcome.

Bankruptcy Lawyers for Ch7 and Ch13

When struggling with unmanageable debt, it is important to consult a lawyer to determine which type of bankruptcy best serves your individual need. Chapter 7 and Chapter 13 both have their own advantages and disadvantages which will depend on your specific financial situation.

For example, Chapter 7 may discharge all or most of your debts but is not available to those who make too much money or have recently filed for another bankruptcy. Chapter 13 allows you to restructure your debt into an affordable payment plan that allows you to catch up on missed payments over a period of three or five years. A lawyer will be able to analyze your situation and discuss with you the legal options that best suit your needs.

In conclusion, Chapters 7 and 13 Bankruptcy offer different advantages to individuals who are struggling with debt. If you find yourself in such a situation, it is important to meet with a lawyer to learn which type makes the most sense for your individual circumstances. Chapter 7 bankruptcy can be an excellent choice for those with very little income or no income at all who are unable to repay their debts.

Those with a regular income, however, should consider Chapter 13 bankruptcy more carefully because it offers the possibility of repaying some debts over time rather than eliminating them entirely. Ultimately, when reviewing your options for debt relief, the most important thing is to speak with an experienced attorney and make sure that the debt relief plan makes sense for your specific situation.


Ch7 vs Ch13 FAQ

Is it better to file Ch 7 or Ch 13?

This will depend on your financial situation and debt situation. To be sure, it is absolutely better for some people to file Ch 7 or Ch 13. It just depends on your situation. We discuss a few of those factors in this article above. See the 2nd paragraph. But, in all cases, you should speak with a bankruptcy lawyer in your jurisdiction to determine which type of bankruptcy is best for you.

Will Chapter 13 ruin my life?

Legally speaking, every situation is different. However, we do not like to be so dramatic when describing the effects of Chapter 13 bankruptcy. In many cases, people use Chapter 13 to RECOVER from a bad financial situation and get on with their life, as opposed to ruining their life. Talk to your attorney for more info on how Ch 13 can help your situation.

Why would Chapter 7 be better for me?

Every situation is different and you need to speak to an attorney to get any kind of meaningful answer to this question. Some people find that chapter 7 is best for them because of certain financial factors which we discuss in the top half of this article. Give your attorney a call for more info after reading the full article.

Many of our Houston area clients ask whether they should file for Chapter 7 bankruptcy or Chapter 13 bankruptcy. To a lesser extent we get inquiries about Chapter 11, but most of our clients focus on Chapter 7 and Chapter 13.

Please call us to discuss the option that is best for you.

This article is only meant to shed a little light on the subject and should not be a substitute for valid legal advice.

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Chapter 7 Bankruptcy in Houston

Chapter 7 is the type of chapter that you may want to file if you just want to walk away from your debt.

Since the Bankruptcy Code was re-written in October of 2005, an individual must qualify for a Chapter 7. An individual must be at or under what is known as the median or average income based on the number of dependents in their household. To determine if you qualify we must look at the last 6 months of income.

An average individual has an exemption for most if not all of their personal belongings and home. As long as your property is at or under the exempted amounts you may keep it in a Chapter 7.

Chapter 13 Bankruptcy – Houston

Chapter 13 is the type of chapter that you may want to file if you have fallen behind on bills for property that you want to keep, such as a car or a home.

An individual can stop a creditor from repossessing a vehicle and from foreclosing on a home by filing a Chapter 13.

A Chapter 13 allows an individual to catch up what they have fallen behind on by repaying that debt over 3 to 5 years. Secured debts, such as a car or home would get priority repayment in a Chapter 13. All unsecured debt such as credit cards and medical bills may receive pennies on the dollar or be completely discharged / wiped out.

Some individuals are over the median or average income, based on the number of dependents in their household. These individuals will need to file a Chapter 13 to repay a portion of their debt over a 5 year plan. Keep in mind, most interest and penalties stop the minute you file.

The amount you repay depends on your disposable income once you meet your normal monthly expenses. You must also account for the amount of property that you may not have an exemption for. You must pay that amount into your Chapter 13 Plan over the course of your five years.

Your Next Step…

If you are trying to decide what bankruptcy option is right for you, then it’s probably time for you to give our law firm a call so that we can help find your best legal option.

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