If you have decided to file for personal bankruptcy in New Jersey, you might be wondering what the differences are between filing for chapter 7 bankruptcy and filing for chapter 13 bankruptcy. Though the situation is stressful and all the new information can be intimidating, knowing the answers could be the key to getting you out of debt quickly. At the end of the day, the goals are the same. You want to save your home from being foreclosed, stop your car from being repossessed, pay back your debts and save your assets.
If you do not qualify for chapter 7 or there are other circumstances, such as your median income exceeding that of the states, your lender may prefer for you to file a chapter 13 bankruptcy. Chapter 13 will not prevent foreclosure, but it is great for those who want to repay debt and take back the control of their property. Some debts are not dischargeable under chapter 7, in which case you would have to file for a chapter 13 bankruptcy.
Chapter 7 is used when you cannot pay back your debt through a debt repayment plan. It is great for those who need relief from creditors and have mostly dischargeable debt.
Filing for bankruptcy can be intimidating, but the two different types help to meet the needs of individuals and their unique circumstances. Both chapter 7 and chapter 13 offer their own advantages and disadvantages to those who qualify. It may be advantageous to speak with a bankruptcy law attorney for more information on the matter.