What’s The Difference Between Chapter 7 And 13?
In order to file under Chapter 7, your income must be less than the median income in the state of Florida. If you qualify, your unsecured debt – credit cards, medical bills, and certain kinds of loans – will be wiped out. However, the court may sell some of your property in order to pay your creditors a portion of what you owe. Typically, non-essential or luxury items are sold. If you cannot maintain monthly payments on your house, it may be foreclosed upon as well.
In a Chapter 13 bankruptcy, your debt is restructured according to a payment plan agreed to by your creditors. A trustee is appointed by the court, tasked with ensuring you make payments on time and creditors receive what they are owed. In general, people who file under Chapter 13 are required to pay back 80% to 100% of what they owe over the course of 3 or 5 years.