What is the difference between Chapter 7 and Chapter 13 bankruptcies? Chapter 7 bankruptcies allow you to erase many debts without having to pay any of it back to creditors. Chapter 13 bankruptcies also erase many debts at the conclusion of a 36 or 60 month payment plan. Chapter 13 bankruptcies also allow you to pay off tax debts over time or catch up on delinquent car and house payments in order to be able to keep your property.

There are advantages of a Chapter 7 filing in Arizona. For example, all debts will be erased for the most part, unless a Reaffirmation Agreement is signed. Wages cannot be garnished after discharge, and collection agencies cannot contact you anymore. Your case will usually be completely discharged after about 6 months from filing.

Chapter 13 advantages in Arizona include keeping all your property as long as you can afford a payment plan. Payment plans are put into place after filing bankruptcy because debt is then reduced. More types of debt are dischargeable in Chapter 13 bankruptcies than in Chapter 7 bankruptcies and you are protected from wage garnishment and collection agencies. Your case will usually be completely discharged after about 3-5 years from filing.

Here at Wright Law Offices, we can help you determine which type of bankruptcy is best for you! We are a debt relief agency and can you file for bankruptcy relief under the Bankruptcy Code. Call our Phoenix bankruptcy lawyer at 602-456-6085 for a free initial consultation.

Source: Arizona Bankruptcy Law, “Arizona Chapter 7 Bankruptcy or Arizona Chapter 13 Bankruptcy?” 2013.