In bankruptcy, deciding to take action is often the first and most important step. The second step is to decide what type of bankruptcy is most suitable for your situation. Don’t worry; you don’t have to decide without consulting with an attorney first. Below are some of the differences between Chapter 7 and Chapter 13 bankruptcy to help differentiate between the two.  

What type of bankruptcy?

  • Chapter 7 - Liquidation (eliminates unsecured debt)
  • Chapter 13 - Reorganization (develop plan for debt repayment)

Who can file Chapter 7 & Chapter 13?

  • Chapter 7 - Individuals, businesses and organizations
  • Chapter 13 - Only Individuals

How long does the bankruptcy process take?

  • Chapter 7 - three to six months
  • Chapter 13 - three to five years

Am I immediately protected from collections and wage garnishment?

  • Chapter 7 - Yes
  • Chapter 13 - Yes

Is my property protected?

  • Chapter 7 - Trustee can sell the nonexempt property to pay debt
  • Chapter 13 - Debtors keep all property. Must pay unsecured creditors an amount equal to the value of nonexempt assets.

How long will bankruptcy stay on my credit statement?

  • Chapter 7 - up to 10 years
  • Chapter 13 - up to 7 years

How often can I file for bankruptcy?

  • Chapter 7 - once every eight years
  • Chapter 13 - repeatedly, no time frame in-between filings

Can I keep my income after filing for bankruptcy?

  • Chapter 7 - Income after bankruptcy is yours and is not garnished by creditors
  • Chapter 13 - Income is subject to repayment plan and used to pay debts
Our bankruptcy lawyers will help guide you through every step in the bankruptcy process and answer any questions that you may have. Contact our bankruptcy hotline at (816) 842-6200 or click here to send us an email from our website
Jason C. Amerine
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President and Owner, Castle Law Office of Kansas City
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