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Clients that qualify under the Bankruptcy Means Test can choose either Chapter. Chapter 7 is for those that need to wipe out unsecured debt, or surrender secured debt on a house or a home without having any deficiencies to pay after the collateral has been sold. Chapter 13 is for those that need to get caught up on a house payment, or refinance their vehicles, or need a five year payment plan to get current on IRS or child support obligations. In Chapter 13, most unsecured debt is either wiped out, or paid at reduced balances, based on your ability to pay.

The court, along with a notice that the bankruptcy stay or injunction is in place that prohibits further collection activity under penalty of contempt. A secured creditor must file a motion and have a hearing in most cases to obtain collateral in a Chapter 7. In a Chapter 13, if the collateral is refinanced, and the payments are made in a confirmed Plan, the secured creditors on a house or a car have no recourse.

Chapter 13 is the ideal way to stop foreclosure and get caught up on back payments in a three to five year plan, while wiping out other debts in most cases.

All debtors must make an appearance before a bankruptcy trustee (not a judge), and answer simple questions about the documents you filed in your case. A appearance in Court before a judge is extremely rare.

No. Debts incurred in the 90 days before bankruptcy is filed, or right after seeing an attorney about bankruptcy relief, can result in the debt being declared non-dischargeable.