If you are struggling with debt and looking for a way out, you may want to explore bankruptcy as an option. However, you may not know that there are different types of bankruptcy options available. Determining which type of bankruptcy — if any — is right for you is a decision you should make once you’re fully informed of your options.
At the Bankruptcy Legal Group in San Diego, we guide clients through the process of filing Chapter 7 or Chapter 13 bankruptcy. To find out more, read the information below or contact our law firm to schedule a consultation.
Chapter 7 vs. Chapter 13 Bankruptcy
Both Chapter 7 and Chapter 13 bankruptcy can help individuals achieve debt relief, but there are many differences between the two:
- Chapter 7 bankruptcy liquidates debt. Debtors are not required to pay back debt as they are in Chapter 13 bankruptcy. Certain assets may be taken away and sold to settle debts. Not everyone is eligible for Chapter 7 bankruptcy. A means test is administered to determine if the debtor qualifies.
- Chapter 13 bankruptcy reorganizes debt. Debtors are required to repay a portion or all of their debts once the debts have been restructured. The repayment plan usually lasts a period of three to five years. Chapter 13 bankruptcy stops foreclosure. Debtors are often able to keep certain assets after filing Chapter 13, unlike in Chapter 7, where assets may be sold to settle debts.
Contact a San Diego Bankruptcy Attorney Today!
For more information about how to file consumer bankruptcy, and to determine your best debt relief option, contact our law firm today. Call (619) 233-4415.
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