Chapter 7 and Chapter 13 Bankruptcy Attorneys in Salt Lake City

This page explains the main differences between a Chapter 7 and Chapter 13 bankruptcy filing and why someone would choose one over the other. This page cannot answer every question and working with an attorney is the best way to ensure success.

Calling the Law Office of Davis & Jones, P.C. at 801-261-2244 and scheduling a free consultation with our Chapter 13 and Chapter 7 bankruptcy lawyer in Salt Lake City can help you decide what bankruptcy filing would benefit your circumstances.

What Is An Automatic Stay?

For both types of bankruptcies, the court will order an "automatic stay" as soon as you file. An automatic stay prevents many creditors from collecting debts or filing lawsuits and can delay a foreclosure on a home. An automatic stay does not necessarily prevent lawsuits that attempt to collect child support payments, pension loans and some tax debts. Automatic stays are not permanent and some creditors can attempt to "lift" the stay in some situations.

Chapter 7 Filings: A Fresh Start

An individual, corporation or partnership can file for a Chapter 7 bankruptcy. This type of filing does not require a repayment plan and allows a debtor to get a fresh start free of many kinds of debts. In a Chapter 7 filing, a trustee must sell a debtor's nonexempt assets. In some cases a home or vehicle may be exempt from sale if they are not behind on payments. These filings do not have a minimum income threshold or maximum debt amount restriction.

Chapter 7 filings cannot discharge in full many kinds of debts, including but not limited to:

  • Child support or alimony payments
  • Debts from property settlements in a divorce or separation
  • Many kinds of tax debts
  • Most types of student loans

Chapter 13 Filings: Repaying Debts In A Plan

A Chapter 13 Bankruptcy filing, also called a reorganization bankruptcy, lets debtors keep their property and create a three- to five-year repayment plan. The debtor must propose this repayment plan, usually with the help of a lawyer, which the courts must then approve. After paying a repayment plan in full, the court will eject any remaining debts accounted for in the plan. To file for a Chapter 13 bankruptcy, the debtor must have a sufficient amount of disposable income based on their individual finances.

Here are some common reasons why debtors chose to file for a Chapter 13 bankruptcy:

  • They do not qualify for a Chapter 7 filing because they failed the means test.
  • They want to keep nonexempt property that a trustee would sell in a Chapter 7 filing.
  • They have debts which a Chapter 7 filing cannot discharge.
  • They want to prevent the repossession of their car or foreclosure on their home.

Talk To Seasoned Utah Bankruptcy Lawyers

Filing for bankruptcy is a complex process and sometimes a bankruptcy is not the best option. Our Chapter 7 and Chapter 13 bankruptcy lawyers in Salt Lake City can answer your questions and set you on the path to success. Schedule your free consultation by calling 801-261-2244 or emailing our lawyers.

We are a federally designated debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.