How do I know what chapter bankruptcy I should file?

Determining the appropriate chapter of bankruptcy to file depends on your specific financial situation and goals. Here are the primary chapters of bankruptcy for individuals and the factors to consider:

1. Chapter 7 Bankruptcy


Chapter 7 bankruptcy is available to individuals with limited income and few assets to repay their debts.


Under Chapter 7, a trustee may sell non-exempt assets to repay your creditors. However, certain assets can be protected through exemptions.

Debt discharge

Chapter 7 typically results in the discharge of most unsecured debts, such as credit cards and medical bills.


Chapter 7 bankruptcy is usually a quicker process, typically lasting a few months.

2. Chapter 13 Bankruptcy


Chapter 13 is available to individuals with a regular income who can create a repayment plan to pay off their debts over time.

Repayment plan

You propose a repayment plan to the bankruptcy court, which usually spans three to five years. It consolidates your debts, allowing you to make affordable monthly payments.

Debt reorganization

Chapter 13 enables you to keep your assets and catch up on missed mortgage or car loan payments. It may also reduce certain types of debt.

Debt discharge

Once you complete the repayment plan, remaining eligible debts may be discharged.


Chapter 13 bankruptcy typically lasts three to five years.

Factors to consider when deciding between Chapter 7 and Chapter 13 bankruptcy:

1. Income and expenses

If your income is below the state median and you have limited disposable income, Chapter 7 may be suitable. If you have a steady income and can afford a repayment plan, Chapter 13 might be a better fit.

2. Assets

Chapter 7 may be preferable if you have few valuable assets or if your assets are protected by exemptions. Chapter 13 allows you to keep your assets while repaying your debts over time.

3. Debt types

Certain debts, such as tax obligations or mortgage arrears, might be better addressed through Chapter 13 bankruptcy.

4. Financial goals

Consider your long-term goals, such as saving your home from foreclosure or restructuring debt, to determine which chapter aligns with your objectives.

It’s important to consult with a qualified bankruptcy attorney who can review your financial situation and guide you through the decision-making process. They will help assess your eligibility and determine which chapter of bankruptcy is most appropriate for your circumstances.

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