| Type of Debt | Chapter 7 | Chapter 13 |
Unsecured debt
Credit card, medical bills, car repossession, personal loans | Most debt is not paid back | 1% to 100% paid back - Depends on plan |
Secured debt
Car | Can keep vehicle if payments current and equity* position low; if kept, payments made directly to lien holder; can surrender without penalty | Missed payments paid back in plan; if car kept, payments consolidated with other debts; can surrender vehicle |
Secured debt
House | Can keep house if payments current & equity* position low; if kept, payments made to mortgage company; can surrender without penalty | Late payments put in plan; main purpose of chapter 13 is to help keep house; regular payments made to mortgage company |
Secured debt
Furniture | Can usually keep; if kept, payments made to lien holder; can turn in without penalty | If kept, late payments and regular payments in plan; can turn in without penalty |
| Pending lawsuit and garnishments | Stopped by filing | Stopped by filing |
| Pending foreclosure |
| Stopped by filing |
| Harassing phone calls | Stopped by filing | Stopped by filing |
| Length | Usually over in 4 to 6 months | Lasts 3 to 5 years |
| Filing fee | $299.00 paid up front | $274.00 ($75.00 min. Paid up front) |
| Attorney’s fee | $1001.00 ($201 up front)* | $3500.00 + paid in plan over 36- 60 months |
| Examples | Person with several thousand dollars owed in credit card bills and/or medical bills; person facing lawsuit and garnishment arising from car repossession | Person with several months behind on home or car note facing foreclosure or repossession; payment of back taxes |
| Advantages | Gets rid of unsecured debt totally; case concludes in 4-6 months | Allows debtor to save house or car when behind; very inexpensive to start case |
| Disadvantages | Attorney’s fees and filing fees ($1300.00) must be paid in full within 60 days of filing; stays on credit report for up to ten years | Debt is paid back in payment plan that lasts 3 to 5 years; stays on credit report for seven years |
