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Chapter 7, Chapter 13

What Costs Less: Chapter 7 or Chapter 13?

If you are considering bankruptcy, it is important to understand the costs and benefits involved. You have the opportunity to eliminate debts that have been crippling you financially. Chapter 7 and Chapter 13 are the most common programs for individuals. If you are exploring reorganizing business debts, Chapter 13 may be an applicable remedy, but only individuals may file a Chapter 13 case.

Chapter 7 Bankruptcy

A Chapter 7 bankruptcy involves the liquidation of assets and property. If you cannot pay back your debts, Chapter 7 bankruptcy allows you to hand over non-exempt assets and property to a trustee, who then sells them to pay back your creditors. However, many cases are considered no asset cases, and no property is sold. You will need to submit to a means test in order to qualify for Chapter 7 bankruptcy, as well as take a credit counseling course. If you are considering Chapter 7 bankruptcy, you should consult with an experienced bankruptcy lawyer prior to filing.

Chapter 13 Bankruptcy

If you wish to instead reorganize your debt and have regular income, a Chapter 13 bankruptcy is the more applicable option. In a Chapter 13 bankruptcy, you are required to pay back some or all of your debt as part of a payment plan that is agreed with and managed by the bankruptcy court. A trustee is appointed to your case for 3-5 years. Once you have completed the term, most debts are discharged, meaning you no longer owe those debts.

Filing Costs & Fees

If you are filing for a Chapter 7 or Chapter 13 bankruptcy, there are administrative fees involved. A Chapter 7 incurs a $335 court filing fee and a Chapter 13 costs $310 to file. In a Chapter 13, you may be able to pay fees in four monthly installments with the permission of the court. The failure to pay the filing fee will result in dismissal of the case.

If you are hiring a bankruptcy lawyer, the complexity of the case may dictate the amount you pay in attorney fees, although the court has standard fee amounts that are automatically approved in most cases. However, the bankruptcy process can be overwhelming if you do not have the support of an experienced and compassionate attorney. There are deadlines and requirements for filing you will need to meet. A reputable lawyer in Georgia will ensure you have all the correct paperwork and guide you through the various stages of the bankruptcy process.

Chapter 7, Chapter 13 Bankruptcy Lawyer

H. Lehman Franklin P.C. is an established bankruptcy law firm in Georgia. If you are concerned your debt is getting out of control and need a solution, we can help guide you wade through your options, including filing for Chapter 7 or Chapter 13 bankruptcy. We have the experience you need to help you navigate the process and make the right decisions to ensure your future financial stability.

Bankruptcy is sometimes a necessary option for debtors who are not able to honor payments to creditors. If you are concerned your finances are getting out of control, seeking remedies is the right course of action. Reach out to H. Lehman Franklin P.C. if you would like to discuss your circumstances with an experienced bankruptcy lawyer.Call us at 912-764-9616, or you can email our offices at info@hlfranklin.com to find out more about what is involved in filing for Chapter 7 or Chapter 13 in Georgia.