Many clients come to me focused on getting a Chapter 7 case filed, which I am happy to help with. However, even if you qualify for a Chapter 7, here is a list of some advantages of filing a 13 instead:
The upfront costs are lower. Chapter 7 clients are required to establish a payment plan to pay the entire attorney fee before filing their case. In Chapter 13, most of my fee can be paid over time. This means immediate relief for clients instead of waiting and saving to file.
If you have two mortgages, your second may be stripped off in Chapter 13. The requirement is the value of your home (think tax value) must be less than the amount owed on your first mortgage.
A Chapter 13 works well with a mortgage modification. Your signed mortgage modification cannot be rescinded because of filing a bankruptcy case. If you file a 13 case after getting your modification approved, you can take care of credit card bills, medical debts, and personal loans while cleaning up your mortgage arrears at the same time.
You can reduce the principal balance on upside down cars and reduce the bad interest rates on car loans in a Chapter 13.
You can keep all of your assets whether they are exempt or not. In a Chapter 7, nonexempt assets are subject to the trustee’s scrutiny. Not so in a Chapter 13.
More people qualify for Chapter 13. Are you earning a decent living and still coming up short each month? A Chapter 13 filing can fix that problem.
Chapter 13 bankruptcy filings offer a ton of relief for people serious about getting their finances in order. I encourage people who are working hard at their job, and still suffering from debt problems, to contact me for a free initial consultation.