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Chapter 7 vs. Chapter 13 Bankruptcy Overview

Chapter 7 and Chapter 13 are the two most common forms of bankruptcy. As you struggle financially and seek a solution to resolve your debt troubles, my firm can discuss the differences with you to help you make educated decisions for your circumstances. At the Law Office of Keith Will Wynne, Esq., I can help you pursue the best option by explaining to you the advantages and disadvantages of each option.

Chapter 7 vs. Chapter 13 Bankruptcy

To break it down as simply as possible, a Chapter 7 Bankruptcy is ideal if your income is below the median income for a household family of your size, and you do not have any assets over your allowed exemptions.


Click here for a deeper discussion of income and assets.


Pros and Cons of Chapter 7 and Chapter 13

Chapter 7 Pro’s

  • In most cases, your case is done 4 months from filing.
  • In most cases, you do not have to pay unsecured creditors back-you walk away with a fresh start.

Chapter 7 Con’s

  • If you own property that you cannot exempt, you only have 3-6 months to pay the value if the property above your exemptions to the Trustee, or you must turn the property over to the Trustee.
  • You cannot change the terms of a mortgage or a vehicle loan.

Chapter 13 Pro’s

  • You are behind on mortgage payments and you want to keep your home.
  • You are behind on car payments and you want to keep your car.
  • You own property that you cannot exempt, and you want to keep that property.
  • Your income is too high for you to qualify for a Chapter 7.
  • You can strip a second mortgage on your home, provided your home is worth less than the first mortgage.
  • You have pay back taxes over 36-60 months, and interest and penalties stop accruing on tax debt.
  • You only have to pay your unsecured creditor exactly what they would be entitled to in a Chapter 7-but with the Chapter 13, you get to pay that back over time.
  • For those with high incomes, it allows you to restructure your debt and almost definitely will drastically reduce the monthly payments you were paying prior to filing.

Chapter 13 Con’s

  • You are in bankruptcy for 36-60 months.
  • You need permission from the Trustee to obtain any new debt, such as for a vehicle.
  • You have to turn in your tax returns every year to the Trustee, and may lose any refund.
  • A large increase in income may result in increased payments.
  • An inheritance may increase your payments.

There are many more differences between Chapter 7 and Chapter 13. Keith Wynne is prepared to take full advantage of the law in order to help you obtain maximum debt relief while enabling you to keep your property.

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Law Office of Keith Will Wynne, Esq. - Plant City Bankruptcy Lawyer

Plant City Office - 1001 E. Baker Street, Suite 101, Plant City, FL 33563. Phone: (813) 567-5894 | Local Phone: (813) 752-3100.


The information on this website is for general information purposes only. Nothing on this site should be taken as legal advice for any individual case or situation. This information is not intended to create, and receipt or viewing does not constitute, an attorney-client relationship.

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