Chapter 7 vs. Chapter 13 Bankruptcy

Chicago Bankruptcy Lawyer

Chapter 7 or Chapter 13? This is an important question to address if you are considering filing for bankruptcy in Chicago. Chapter 7 bankruptcy is the most common form of bankruptcy that individuals and married couples utilize throughout the U.S., but it may not be the right choice for everyone. All borrowers may not qualify for a Chapter 7 bankruptcy in the first place, due to the means test. This test measures a borrower's income and ability to make payments under a Chapter 13 repayment plan, effectively prohibiting borrowers who fail the means test from filing a Chapter 7 case.

Regardless of passing the means test, there are specific advantages associated with a Chapter 7 or Chapter 13 bankruptcy in the Chicago area. As a borrower, it is important to understand these so you can make the right choices about filing for bankruptcy and which chapter will be best for you.

About Chapter 7 and Chapter 13 Bankruptcy

Following are a few key points about Chapter 7 and Chapter 13 bankruptcy:

Chapter 7 - involves the liquidation of assets and property to pay off creditors. This type of bankruptcy is typically beneficial to borrowers with little to no income and may be completed relatively quickly; in a matter of months. Click here to learn more about Chapter 7 bankruptcy .

Chapter 13 - this form of bankruptcy involves a repayment plan to pay a portion or all of the borrower's debt over a 3 to 5 year time period. This form of bankruptcy is generally better for borrowers with steady incomes, who own homes and who have property they wish to protect through the bankruptcy process. Click here to learn more about Chapter 13 bankruptcy .

If you would like to find out more about this important topic and how our firm can help you, contact a Chicago bankruptcy attorney at our offices today. Your initial consultation is free and confidential.