The Differences between Chapter 7 and Chapter 13 Bankruptcy

Bankruptcy protection can provide those who are struggling with substantial debt a way to move forward in their lives, free of worrying about harassing creditor calls and threats of repossession or foreclosure. However, there are important differences between the various types of bankruptcy that debtors may be able to pursue, of which the most common are Chapter 7 and Chapter 13.

Chapter 7 and Chapter 13 bankruptcy are both potential options for individuals struggling with substantial debt problems. However, depending on the nature of an individual’s exact situation, it may be more advantageous to choose one of these forms of bankruptcy over the other. That’s why The Coyle Law Group believes it is essential that those in Maryland who are considering bankruptcy understand the differences between Chapter 7 and Chapter 13 bankruptcy.

Chapter 7 vs. Chapter 13

The following is a brief explanation of some of the most important differences between Chapter 7 and Chapter 13 bankruptcy:

  • In order to qualify for Chapter 7 bankruptcy, an individual’s income must meet certain levels. In contrast, individuals at all income levels may apply for Chapter 13 bankruptcy.
  • Chapter 7 bankruptcy resolves debt issues by liquidating some of a debtor’s assets (with important exemptions), while Chapter 13 bankruptcy restructures a person’s debt to make it more feasible to continue making their payments.
  • Chapter 7 bankruptcy results in complete forgiving of most debt, while Chapter 13 bankruptcy may clear only some debts or none at all.
These are some of the most crucial distinctions between Chapter 7 and Chapter 13 bankruptcy.

Talk to a Bankruptcy Attorney in Maryland

Talk to a Bankruptcy Attorney in Maryland

If you have serious debt issues and want help taking care of them, the experienced legal team at The Coyle Law Group, can help walk you through all of your potential options and develop a plan for how to move forward. Contact us today at 410-884-3180 to speak with one of our experienced legal professionals and learn more about what we may be able to do for you.