Chapter 7 Bankruptcy vs. Chapter 13 Bankruptcy
Bankruptcy Attorney in Chino
If you are struggling financially and buried under a mountain of debt, you may be able to bring the problem to an end by filing bankruptcy. There are two forms of bankruptcy that may fit your circumstances, Chapter 7 or Chapter 13 . These two forms of bankruptcy allow debtors to get a fresh start, but are very different. While Chapter 7 bankruptcy is a faster process than a Chapter 13 bankruptcy, taking about 4 - 5 months to complete, each form of bankruptcy has its benefits. If you are considering filing for bankruptcy, you should contact a Chino bankruptcy lawyer from the Law Offices of David R. Gunnin to help you determine whether you qualify for Chapter 7, or if Chapter 13 is a better choice for your personal financial situation.
Chapter 7 vs. Chapter 13: What is the difference?
Chapter 7 bankruptcy allows for the discharge (you will no longer owe) unsecured consumer debt, such as credit cards, medical bills, overdue utility bills, personal loans and others. Exemptions are allowed in this form of bankruptcy, and most people who file Chapter 7 lose nothing - except debt. Chapter 13 bankruptcy, also known as reorganization, or individual debt adjustment, allows an individual to keep property and other assets, and is a good option for those who don't wish to file Chapter 7, or do not qualify due to the number of assets owned, or level of income.
Chapter 13 is also called "wage-earners bankruptcy" and is frequently the correct form of bankruptcy for those with a steady income from employment or from self-employment. In Chapter 13, your back debt will be repaid in one payment each month - this payment amount will be based upon your income and the available money you have after paying your expenses. The repayment schedule will be designed to pay your outstanding obligations over a 3 - 5 year period, and in most cases, penalties and interest are not included. At the end of this process, the remaining debt is discharged, and the chapter 13 process is complete.
Making a decision about Chapter 7 bankruptcy vs. Chapter 13 bankruptcy can be confusing, and you should have accurate information before you make a decision. Call us for an appointment so that we can discuss your specific situation and help you decide which option of bankruptcy is right for you.