Which Personal Bankruptcy Chapter is Right For Me?

First you must decide if you need to file for personal bankruptcy. It may be possible to reduce your expenses or increase your income so that you can repay your debts and avoid bankruptcy. A debt consolidation loan is another option for dealing with debt. If bankruptcy is your chosen option, the correct chapter, will depend on your situation. Chapter 7 bankruptcy and Chapter 13 bankruptcy are outlined below.

When to File For Chapter 7 Bankruptcy

If you are a business, you can file under Chapter 7 or Chapter 11. A family farmer can file under Chapter 12.

If you are an individual, you can file a liquidation bankruptcy under Chapter 7, or a re-payment plan proposal under Chapter 13.

Generally a Chapter 7 bankruptcy is filed by a person with limited or no assets. With no assets, it is a relatively simple procedure.

When to File For Chapter 13 Bankruptcy

If you have sufficient income to re-pay at least a portion of your debts, a wage earner repayment plan under Chapter 13 bankruptcy may be right for you.

The choice of the type of bankruptcy is up to you. There are several "do it yourself" books on bankruptcy that explain the bankruptcy process.

However, bankruptcy law is complicated, to help make your decision, professional advice is always a good idea. Remember that the bankruptcy clerk's office staff, bankruptcy petition preparers, typing services and paralegals are prohibited by law from giving you legal advice. Only a lawyer can give you legal advice.

Most bankruptcy lawyers will give you a free consultation. They will go over your family situation, review your debts and your assets, and explain the different options. They will also explain what services they provide, and how much it will cost.

The decision to file personal bankruptcy, and the choice of which bankruptcy chapter to file under, is an extremely important decision, and should be made only with competent legal advice from experienced CA bankruptcy lawyers after a review of all of the relevant facts of the your case. Please read our Chapter 7 bankruptcy and Chapter 13 bankruptcy pages for more information.