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Which Chapter is Right for Me?

Chapter 7 vs. Chapter 13 Bankruptcy in Kansas

Which chapter is right for me?

If you are considering bankruptcy, you may have concerns as to which chapter is right for your unique situation. You may have heard different information about both Chapter 7 and Chapter 13 bankruptcy, and this may have left you without a clear picture of the approach that will help you reach your financial goals for the future. Fortunately, you can turn to a Kansas bankruptcy attorney for the experienced guidance you need. With extensive experience in this field and having handled hundreds of bankruptcy filings for debtors throughout the state, Rick Hodge, Attorney at Law, can provide helpful information that is tailored to suit your particular needs. He can assist you through the decision-making process to help ensure that bankruptcy is the right choice for you and that you choose the chapter that will properly address your debt and financial situation.

The Key Differences: Liquidation and Reorganization

Chapter 7 bankruptcy is often referred to as "straight bankruptcy" or "liquidation". It involves the surrender of non-exempt assets to the bankruptcy court to be liquidated and the proceeds distributed amongst creditors. A common misconception about this form of bankruptcy, however, is that all of a debtor's assets will be surrendered. This is simply not the case. Under both state and federal bankruptcy exemptions, much of a debtor's assets will be protected. Most debtors lose nothing at all. This type of bankruptcy is typically the fastest and most straightforward, with the case completed in approximately 4 to 6 months and all of a debtor's eligible debt discharged upon its successful completion. To qualify to file Chapter 7, a debtor must pass the means test, meaning his or her income or disposable income must be below a certain level.

Chapter 13 bankruptcy is often referred to as "reorganization" or a "wage earner's plan". This type of bankruptcy is often advisable for debtors with steady incomes and non-exempt property that needs protection from liquidation. Although this type of bankruptcy takes significantly longer than Chapter 7, with a payment plan that lasts 3 to 5 years, it has specific benefits that should be recognized. A key benefit of Chapter 13 bankruptcy is its power to save a debtor's home from foreclosure. Because a reorganization of debt is involved in this type of bankruptcy, the debtor may be able to include past due mortgage payments in his or her repayment plan. Chapter 13 bankruptcy also protects co-signers, who may otherwise be held liable for the debt if the debtor files Chapter 7.

Contact a Kansas bankruptcy lawyer today!

It is impossible to say which chapter may be right for you without a complete analysis of your debt, income, disposable income and financial goals. That is why we recommend that you contact our offices as soon as possible. With a bankruptcy lawyer who is experienced in handling Chapter 7, Chapter 13 and Chapter 11 cases in Kansas by your side, you can get the help you need to make the right choice.

Take the right approach to your financial situation and eliminate your debt. Contact a Kansas bankruptcy lawyer at our firm today!

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