What is the difference between Chapter 7 and Chapter 13 Bankruptcy?

This is one of our most commonly asked questions! There are two main types of filings when dealing with a personal bankruptcy, a Chapter 7 and Chapter 13. The type that's right for you will depend on what you are looking to achieve, and the amount of debt you are dealing with.

Let's look at the differences between the two types of filings

Chapter 7 is a liquidation bankruptcy and is known to be a ‘quick process’. This filing wipes out a majority of your general unsecured debts. These debts include medical bills, credit cards, payday loans, etc.

Chapter 13 is a reorganization bankruptcy and is designed for debtors that maintain regular income. A debtors income is assessed and left over monthly income is delegated towards paying back a portion of the debts owed via a repayment plan.

Are you considering filing bankruptcy and starting over with a clean slate? Give us a call. We’d love to learn about your situation and see how we can help.


Thomas Sands