The Differences You Need To Know Between Chapter 7 and 13

The Maryland Bankruptcy Center and the Law Offices of David L. Ruben, P.A., handles two different types of bankruptcy cases.

Chapter 7 bankruptcy is the most common form of bankruptcy.   Chapter 7 is what you need if you have a lot of bills and no means to pay them.  You can own a home and other property in a Chapter 7, but you must have very little equity in the home or car, that is, if you have the ability to sell your property and pay off your bills, Chapter 7 is not for you.  The other qualification for Chapter 7 is income.  This depends on how much money you (and your spouse if you are married) have earned during the six months before filing bankruptcy and also how many people live in your household.  When you call, we will go over the numbers with you and determine if Chapter 7 is the right way to go.

Chapter 13 is the other type of consumer bankruptcy.  If you find yourself behind on your mortgage but you want to keep your home, and you just do not have the ability to get current, Chapter 13 is the right Chapter.  As soon as a Chapter 13 is filed, the foreclosure action stops and you begin making payments to pay back the arrearage, usually over a period of 5 years.  Chapter 13 is also for people who make too much money to file Chapter 7 or who have too much equity in their property.

Call us today for your free consultation on a Chapter 7 or a Chapter 13 bankruptcy.