Although both merit a discharge of debt, the difference between a Chapter 7 vs. a Chapter 13 bankruptcy court filing is that through Chapter 7, much of your property is liquidated, while a Chapter 13 protects your property. Speak with an attorney about whether or not filing for bankruptcy in Texas is a strategic move for you.
A Chapter 7 bankruptcy discharges the majority of your debts, but in exchange, a trustee can take any property of yours that isn’t exempt and sell it off to pay back your creditors in part or in whole.
Exempt property includes a certain amount of equity in your home, the cash value of your insurance policies, public benefits (welfare, unemployment insurance, Social Security), your retirement plan, tools of your trade or profession, personal and household goods such as appliances, furniture, clothing, etc. You will be allowed to keep a certain amount of jewelry and your vehicle.
On the other hand, a Chapter 13 bankruptcy protects your property because you pay your creditors through a trustee-supervised and court-approved repayment program. A Chapter 13 bankruptcy also protects your co-signers and co-debtors from harassment by collectors.
If you’ve been considering a bankruptcy court filing, speak with an attorney who emphasizes bankruptcy in his or her practice and who knows how to manage cases similar to yours. Your attorney can help you understand what your financial options are for the future, including helping you understand what assets after a bankruptcy filing are protected and which type of filing, Chapter 7 vs. Chapter 13, is right for you.
Contacting an Attorney About Bankruptcy in Texas
At Warren & Migliaccio, our goal is to protect you and your family so that you can take the necessary steps to proactively plan for your future. We’ll guide you through different steps of the legal process, including determining what your assets after bankruptcy will look like. We will help you determine the pros and cons of a Chapter 7 vs. Chapter 13 bankruptcy. If a personalized, teamwork-driven approach sounds like what you need for your case, call 1-888-584-9614 today. We’re here to help.