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Chapter 13 vs Chapter 7

A Chapter 13 case involves most of the same forms and information you would provide in a Chapter 7 case filing. However, the core of a Chapter 13 is the Chapter 13 Plan. It is a plan or reorganization of your debt that is approved by the court. What a plan will provide will differ in every circumstance as they are tailored to each person's individual debt issues. In essence, you make a monthly payment to the Chapter 13 Trustee who is charged with administering the funds in your case and makes distributions to your creditors based on the terms of your Chapter 13 plan and the claims filed by your creditors. Most people file Chapter 7 Bankruptcy cases. However, there are about a half a dozen reasons why you'd consider a Chapter 13 Bankruptcy filing. ?You are behind on mortgage or car payments. ?You have assets you could lose in a Chapter 7. ?You have filed a Chapter 7 in the past 8 years. ?You have recent tax debts, student loans, alimony or child support arrears that you need help with. ?You do not qualify for a Chapter 7 because you have too much income. ?Some people simply want to do a repayment rather than discharge the debt in a Chapter 7.

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