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Roger, Attorney
Category: Bankruptcy Law
Satisfied Customers: 30899
Experience:  BV Rated by Martindale-Hubbell; SuperLawyer rating by Thompson-Reuters
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Should I file chapter 7 or chapter 13

Resolved Question:

Should I file chapter 7 or chapter 13
Submitted: 6 years ago.
Category: Bankruptcy Law
Expert:  Roger replied 6 years ago.

Which chapter really depends on what you want to do. With a Chapter 13, you get to keep all of your stuff, but you don't have to pay the full amount of the debt owed. Instead, you pay the lender back the current value for all property.


For instance, if you owe $500000 on your house and now it's worth $250000, you'd have to pay back the $250000.


Chapter 13 plans are usually set for 5 years to pay off most debts (mortgages are the usual exception.


Chapter 7 is a complete liquidation of all debts except those you may want to keep - like your house or car payments. All other debts are discharged/wiped away.


Both filings effect you bankruptcy, but Chapter 13 looks better because you just didn't walk away - you paid the lenders a reduced sum.


My suggestion is to meet with a bankruptcy attorney, look at your financials and then decide.

Customer: replied 6 years ago.
We want to get out of our current home. Is there a way to purchase a smaller home before or during a filing for bankruptcy. We have 100K in CC debt as well.
Expert:  Roger replied 6 years ago.
If you're gonna get a new home, you need to do so before filing bankruptcy. It'll be at least 5 years post bankruptcy before you'd have a legitimate chance at getting a house.
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