Why choose Chapter 13 over Chapter 7 bankruptcy?
Although the overwhelming number of people who file for bankruptcy choose Chapter 7, there are several reasons why people select Chapter 13: • You cannot file for Chapter 7 bankruptcy if you received a Chapter 7 or Chapter 13 discharge within the previous six years (unless you paid off at least 70% of your unsecured debts in a Chapter 13 bankruptcy). On the other hand, you can file for Chapter 13 bankruptcy at any time. • You have valuable nonexempt property. • You’re behind on your mortgage or car loan. In Chapter 7, you’ll have to give up the property or pay for it in full during your bankruptcy case. In Chapter 13, you can repay the arrears through your plan, and keep the property by making the payments required under the contract. • You have debts that cannot be discharged in Chapter 7. • You have codebtors on personal (nonbusiness) loans. In Chapter 7, the creditors will go after your codebtors for payment. In Chapter 13, the creditors may not seek payment from your codebtors for
