Chapter 7 vs Chapter 13 · Beverly Hills
Chapter 7 or Chapter 13: Which One Fits You
Chapter 7 or Chapter 13 depends mostly on your income, what you own and whether you are behind on a house or car. Chapter 7 is faster and wipes out debt in a few months. Chapter 13 takes three to five years but can save a home in foreclosure and protect property Chapter 7 cannot. Call (310) 362-9071 and we will compare both for your situation at a free consultation.
- Chapter 7 usually ends in a few months; Chapter 13 lasts 3 to 5 years
- The means test decides whether Chapter 7 is open to you
- Chapter 13 can catch up missed mortgage payments; Chapter 7 cannot
At a glance
Chapter 7 and Chapter 13 side by side
Here is how the two chapters compare on the points most people ask about first.
| Question | Chapter 7 | Chapter 13 |
|---|---|---|
| How long does it take? | Usually about 3 to 4 months from filing to discharge | 3 to 5 years of plan payments, then discharge |
| Who qualifies? | People who pass the means test, or whose debts are mostly business debts | Individuals with regular income and debts under the federal limits |
| What does it stop? | Lawsuits, garnishments, bank levies, collection calls and, for a time, foreclosure and repossession | The same, plus it can stop a foreclosure for good by catching up missed payments over time |
| Can I keep my house? | Yes, if your payments are current and your equity is covered by the homestead exemption | Yes, even if you are behind; missed payments are spread over the plan |
| Can I keep my car? | Yes, if you stay current and equity is exempt; or redeem it for its value | Yes; some loans can be reduced to the car's value |
| What about co-signers? | Creditors can go after them right away | The co-debtor stay protects them on consumer debts |
| Attorney fee | Our flat fee starts at $1,200, plus the court filing fee; paid before filing, with payment plans available | We quote your fee in writing; much of it can be paid through the plan |
| Court filing fee | $338; can be paid in installments or waived for low income | $313; can be paid in installments |
| Credit report | Usually up to 10 years from filing | Usually up to 7 years from filing |
The court filing fees shown have been in effect since December 1, 2023. See filing fees, waivers and payment plans for how to pay them.
For Chapter 13, the court in the Central District of California sets a limit on the flat fee lawyers can charge without filing a detailed fee request. For cases filed on or after May 1, 2024, it is $7,000 for a consumer case and $8,500 for a case with business debts.
When Chapter 7 usually fits
Chapter 7 is often the right choice when:
- Most of your debt is credit cards, medical bills, personal loans or old judgments
- Your income is below the California median, or you pass the full means test
- You are current on your house and car, or you are willing to let them go
- What you own is covered by California exemptions
- You want a fresh start quickly
In Chapter 7, a trustee reviews your property. Exempt property is yours to keep. Non-exempt property can be sold to pay creditors, but for many people, most or all of their property is exempt. Learn more on our Chapter 7 bankruptcy page.
When Chapter 13 usually fits
Chapter 13 is often the right choice when:
- You are behind on your mortgage and want to keep the house
- Your income is too high for Chapter 7
- You have equity or property that Chapter 7 would not protect
- You owe recent taxes or support that you need time to pay
- A family member co-signed debts you want to shield
- You received a Chapter 7 discharge too recently to file Chapter 7 again
You make one monthly payment to a trustee for three to five years. When you finish, most remaining unsecured debt is discharged. See our Chapter 13 bankruptcy page for how plans work.
Decision guide by situation
| Your situation | Usually points to | Why |
|---|---|---|
| Behind on your house and want to keep it | Chapter 13 | Only Chapter 13 lets you catch up missed payments over time |
| Mostly credit card and medical debt, modest income | Chapter 7 | Fast discharge, and most property is exempt |
| Income above the California median | Depends on the means test | Allowed expenses may still let you qualify for Chapter 7 |
| Large tax debt | Depends on the age of the taxes | Older income taxes may be discharged in Chapter 7; recent ones can be paid over time in Chapter 13 |
| Filed before | Depends on the dates | Chapter 7 after Chapter 7 needs 8 years; Chapter 13 after Chapter 7 needs 4 years for a discharge |
| Little income, only exempt assets, small debts | Maybe neither | You may be safe from collection without filing |
Bankruptcy is not always the answer. Read when you should not file bankruptcy before you decide.
Common mistakes when choosing a chapter
- Picking by price alone. Chapter 7 costs less up front, but it cannot save a house that is behind.
- Skipping the means test. Guessing at income can lead to the wrong chapter and a dismissed case.
- Using the wrong exemption system. California has two systems, and the choice can decide what you keep.
- Filing with the cheapest service. See what goes wrong in a cheap bankruptcy filing.
- Worrying only about credit. Many people see their credit improve once debt is gone. See rebuilding credit after bankruptcy.
What it costs
- Chapter 7: flat attorney fee from $1,200, plus the $338 court filing fee
- Chapter 13: attorney fee quoted in writing, and part of it can be paid through the plan
- Payment plans are available, and the first consultation is free
Questions about choosing a chapter
Is Chapter 7 or Chapter 13 better for me?
Whether Chapter 7 or Chapter 13 is better for you depends on your income, your property and whether you are behind on a house or car. Chapter 7 is faster. Chapter 13 protects more in certain cases. We compare both at your free consultation.
Can I switch from Chapter 13 to Chapter 7 later?
Yes, you can switch from Chapter 13 to Chapter 7 later if you qualify. You have the right to convert at any time while the case is open.
Which chapter is cheaper?
Chapter 7 is usually cheaper. Our Chapter 7 flat fee starts at $1,200 plus the court filing fee. Chapter 13 costs more, but much of the attorney fee can be paid through the plan rather than up front.
Which chapter hurts my credit less?
Chapter 13 usually stays on your credit report for up to 7 years, compared to up to 10 years for Chapter 7. Either way, you can start rebuilding credit soon after filing.
Can I keep my house in Chapter 7?
Yes, you can often keep your house in Chapter 7 if your payments are current and your equity is covered by the homestead exemption. If you are behind, Chapter 13 is usually the way to keep it.
Free consultation
Compare both chapters in one meeting
Call (310) 362-9071 or send the form. We will look at your income, property and debts and tell you which chapter fits.
Law Offices of John Asuncion9454 Wilshire Blvd., Penthouse Floor
Beverly Hills, CA 90212
(310) 362-9071
Monday to Friday, 9 a.m. to 6 p.m.