Debts Voluntarily Paid in Chapter 7
Chapter 7 is usually much better if one of your high priorities is to favor a debt by paying it. You can do so more easily and flexibly.
Exceptions to the Discharge of Debts in Chapter 7
Often all your debts are discharged--legally written off--in Chapter 7. But some you might want to pay, or might not be able to discharge.
“General Unsecured Debts” in Chapter 13
You pay your general unsecured debts only as much as you can afford during a Chapter 13 plan, with the rest then legally written off forever.
“General Unsecured Debts” in Chapter 7
In a Chapter 7 case all or most "general unsecured debts" get "discharged"--legally written off. That's one of the big benefits of Chapter 7.
Unsecured Debts in Bankruptcy
Your debts are either secured by something you own, or they are unsecured. Unsecured debts are either "priority" or "general unsecured."
Chapter 13 with a Judgment Lien, HOA Lien, or Child/Spousal Support
Chapter 13 can work much better than Chapter 7 if you have a judgment or HOA lien on your home, or get behind on child or spousal support.
Chapter 13 with a 2nd Mortgage, Property Taxes, or Income Tax Lien
Chapter 13 can work much better than Chapter 7 if you have a second mortgage, get behind on property taxes, or have a tax lien on your home.
Chapter 7 with a Judgment Lien, HOA Debt, or Support Obligations
Here are 3 more scenarios for when you are current on your mortgage, where Chapter 7 works well in dealing with other home-related debts.
Your Paid-Current Home Mortgage in Chapter 7 and 13
There are scenarios when you are current on your home mortgage and are dealing with other home-related debts where Chapter 7 works well.
Your Home Mortgage in Chapter 7 and Chapter 13
Here are 6 ways filing a Chapter 7 case can help you deal with your home lender and related debts, and 6 ways filing a Chapter 13 one can.
Simple and Not-so-simple Debts in Chapter 7 and 13
Very broadly speaking Chapter 7 handles simple debts as well or better than Chapter 13 does, which handles more difficult debts better.
The Automatic Stay in Chapter 7 and 13
Filing a Chapter 7 or 13 case both stop creditor collection actions against you just the same. But after that the differences are huge.
Using Time to Your Advantage in Chapter 7 and 13
Chapter 7's big advantage is that it's quick. Chapter 13's big advantage is that it buys you more time to do what you want or need to do.
Keep an Open Mind about Chapter 7 or 13
Here's an example why to keep an open mind about filing under Chapter 7 vs. Chapter 13. Slightly different facts can make all the difference.
Chapter 7 or 13? You May Be Surprised
Chapter 7 takes about 4 months, while Chapter 13 takes 3 to 5 years, and likely costs more. But that doesn't begin to answer which is better.