Chapter 7 versus Chapter 13, which is better?

Bankruptcy Attorney

It’s actually a trick question. There is no better chapter.

Each chapter is designed to accomplish different goals. As a general rule, people who have little equity in their property and have income that is below the median income will often find that Chapter 7 is the proper Chapter to file. Chapter 7 is not a payment plan, it simply wipes out unsecured debts. And, most of the time, people keep their car and their house in a Chapter 7.

Chapter 13 is designed to allow people to catch up on missed payments for their cars and houses and keep the car or the house. Also, people who make more money than the average for their family size will frequently find a Chapter 13.

In both chapters, it is generally true that you can make a decision to keep or not to keep property that you owe money on, for example, your house or your car.

There is no “one-size-fits-all” answer to which Chapter a person or a family should file. It depends on a number of different factors which need to be discussed with your bankruptcy attorney.

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