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What makes Chapter 13 bankruptcy different from Chapter 7?

Phoenix, AZ |

My wife and I need to file for bankruptcy, but don't know which to choose, and even know what either of those things mean. Is this something any bankruptcy attorney can help us decide?

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Attorney answers 8


A chapter 7 is a liquidation type of bankruptcy in which you request that your debts be foregiven except for debts secured by property you wish to keep and non-dischargeable debts like taxes. It is called a fresh start bankruptcy. A chapter 13 bankruptcy is a proceedings in which you agree to pay some or all of your debts back in monthly payments over a period of 3 to 5 years. This type of bankruptcy is called a wage earnerts plan.


Yes, you should talk to an experienced bankruptcy attorney before deciding whether bankruptcy will help you in your unique situation. Most all consumer attorneys offer an initial free consultation. Below is a link to a series of free videos that explain the basics of bankruptcy.

Let me know if you would like a free consultation.

This firm is in the business of helping people and companies file for bankruptcy protection. Therefore, the bankruptcy code requires that we call our firm a "debt relief agency." This information is provided for general information purposes only and is not intended to be a legal opinion, legal advice or a complete discussion of the related issues. Nor is this advice intended to create a client - attorney relationship. Every individual's factual situation is different and you should seek independent legal advice from an attorney familiar with the laws of your state or locality regarding specific information.


You should consult an attorney. Any competent bankruptcy attorney will advise you of the major differences between the two in much more detail than we can here. The most simplified difference is that a Ch7 provides a nearly instant discharge of debt and Ch13 requires you to pay money to a Ch13 trustee for a period of time who will then make payments on your behalf to your creditors, both secured (mortgages, car payments) and unsecured (credit cards, signature loans, medical bills).

DISCLAIMER: This message is intended as a general discussion of legal issues and not as a statement of fact, legal advice or a legal opinion. No attorney-client relationship is created by this message. Do not act or rely upon law-related information in this communication without seeking the advice of an attorney licensed to practice in the relevant area. I am a Federally Designated Debt Relief Agency under the United States Bankruptcy Code. I proudly help people in financial need file bankruptcy cases. IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication (or in any attachment).


Bankruptcy attorneys have a positive duty to explain your different filing options. By all means talk to an attorney. You should expect to pay for the education, however. I don't offer free consultations, for example, because my time and knowledge are my stock in trade, and they're valuable.


You should listen to Ms. Drain. Nearly all bankruptcy attorneys offer free consultations where they can advise you on the different chapters. You may qualify for a Chapter 7, but if a Chapter 13 is the better option for you then you can choose that. You can look at my guide, which is one of the links below; but for the pros and cons of each chapter as they apply to your situation, you need to consult with an attorney.

Tom Cesta is an Attorney with Fife & Cesta, a compasionate bankruptcy firm conveniently located off the US 60 in Mesa, Arizona. The answers given here are based on the information in the question, but for a complete answer you should have a consultation with an attorney you trust. Call now for a free bankruptcy consultation. We carefully evaluate your situation and give you real advice.


It sounds like you need to consult with a bankruptcy lawyer. The AZ lawyers who have responded to you here on AVVO, including me, can all probably help you. So, call 2 or 3 of us and hire whomever you're most comfortable with.

Mr. Greeves is licensed to practice law throughout the state of Arizona. His office is in Tempe. His phone number is 480-422-1850 or his email address is His website is

Mr. Greeves is licensed to practice law throughout the state of Arizona. His office is in Tempe. He is authorized to handle IRS matters throughout the United States. His phone number is 480-422-1850 or his email address is His website is Please note that this answer does not constitute legal advice, and should not be relied upon. Each state has different laws, every situation is fact specific, and it is impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue. This answer does not create an attorney-client relationship.


If you visit an attorney who does not talk about both types of bankruptcy, you should probably not go back.

Even if it does not make sense for the situation, I explain both types of bankruptcy. This is so clients can understand why a Chapter makes more sense.

Good luck.

Jim Webster

1845 S. Dobson Rd. Ste 201
Mesa, AZ 85202

(480) 464-4667

We are a debt relief agency. We help people file for relief under the Bankruptcy Code.

Please contact me directly with document for a free 30 minute consultation to get more concrete advice. This is not legal advice. I don't have enough information to give actual legal advice. I can only take the limited information presented and provide a framework to know how your situation may turn out. I may have questions that bring up issues you did not think were important but make a big difference.


Consult an attorney probably isn't the answer you are looking for. So to add in my 2 cents worth, you have to qualify financially to file either a Chapter 7 or a Chapter 13.

In a Chapter 7, you must show that you don't have enough money to pay even a fraction of your debts off over a 5 year period. The more you owe, the more money you can have left over. For most of my clients, that means no more than $150/month is left after paying necessary basic living expenses. Not partying at the Palms, gambling or taking vacations.

In Chapter 13, you must show that you do have money left over to pay a portion of your debts after paying your necessary basic living expenses. If you have certain types of debts, Chapter 13 can be very attractive because it allows you to eliminate or pay off these debts at 0% interest which you cannot do in a Chapter 7.

Hope this perspective helps!