Chapter 7 provides the greatest possible relief from dischargeable unsecured claims (credit cards, mortgage deficiencies, medical bills, etc.). The debtor keeps exempt property and the case is closed after about four or five months which makes it a very desirable remedy.

Sometimes Chapter 13 is an alternative that can’t be avoided. In Chapter 13, the debtor files a plan with the court to make a series of payments, either a 36 month period or 60 month period, to pay the unsecured debt. Why file Chapter 13:

• A debtor makes too much money and cannot qualify for Chapter 7.
• A debtor is behind on their home mortgage, so they need to use Chapter 13 to catch up the arrears over a 60 month period.
• A debtor has too much equity in their assets and would lose them in a Chapter 7 case, so they file a Chapter 13 case and in effect, buy back the assets’ equity from their creditors.