Chapter 7 or 13? Which One is Right for You?

The appeal of Chapter 7 is the fact that most of your debt will be discharged. With a wave of a magic bankruptcy wand, your debt will disappear right before your very eyes. Sounds too good to be true, right? Chapter 7 is great in some ways, but your debt doesn’t disappear into thin air without a price. You might end up losing any homes, heirlooms, investments, stocks, jewelry, expensive clothes or artwork that you own. And alimony, student loans, child support and legal fines aren’t dischargeable.

People file for Chapter 13 if they make too much to file for Chapter 7 or if they have debts that they are unable to discharge. This is also a good option for those that are looking to keep any property they own because they’ll be given the chance to continue making payments toward their debt over the course of 3-5 years.

It’s best to talk with a professional before deciding to file for Chapter 7 or 13. Consulting with a good bankruptcy lawyer is advisable before going ahead with any paperwork. Determine what you want to get out of the bankruptcy and if your debts are dischargeable before making your final decision.

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