Chapter 13 vs. Chapter 7: What's the Difference?
Most people believe that Chapter 7 involves giving up all your property and a Chapter 13 means you can keep everything. But as with all bankruptcy cases, the reality is a little more complicated.
In a Chapter 7, most people get to keep most or all of their property. And Chapter 7 filers don't have to pay back a portion of their debts, like Chapter 13 filers do.
Chapter 7 Timeline
A typical Chapter 7 takes three to six months, and at the end the person is debt-free except for “non-dischargeable debts” like mortgages, car payments, student loans, etc. Although you can lose property in a Chapter 7, most filers don’t. They can keep their homes and cars. However, not everyone is eligible for a Chapter 7. Filers must pass a “means test” that determines whether or not your income is low enough for Chapter 7. High-income filers would then need to use Chapter 13 to restructure and pay back their debt.
These complexities are why Castle Law Office recommends filers obtain the services of a knowledgeable bankruptcy attorney to help with their case. People who file pro se are often overwhelmed by the complexity of bankruptcy and the amount of legal rules you have to follow.
Castle Law offers free consultations for all cases, and we can help you decide which type of case is best. Call us today at 816-842-6200, or contact us by email.