YOUR FILING OPTIONS
Major Differences Between Chapters
| FEATURES BY CHAPTER****** | 7 | 11 | 12 | 13 |
| DISCHARGE TIME | 6 months + | varies, min. 3 years | 3-5 years | 3-5 years |
| FILING FEE | $299 | $1,039 | $239 | $274 |
| ELIGIBILITY****** | No prior Chapter 7 discharge past 8 years & pass the means test**** | All Consumers | Family Farmers only | Most Consumers Secured debt <$1,010,650 Unsecured debt < $336,900 |
| MINIMUM PAID BEFORE FILING* | $1,799 | varies* | varies* | >lowest |
| TOTAL COST***** (inluding attorney's fees) | $1,799 | $9,000 and up | $4,000 and up | $3,359 and up |
| CRAM DOWN Pay only what your collateral is worth, not what you owe*** | No, but you can redeem if you can pay the value in one lump sum.** | Yes | Yes | Yes |
| CATCH UP to get current on your mortgage or other loan without losing the collateral | No | Yes | Yes | Yes |
| TIME FOR FILING OF REORGANIZATION PLAN | N/A | No deadline, but after 120 days creditors may file a plan, or after 100 days if you choose small business status. | 90 days | 15 days |
Reagrdless of which bankruptcy chapter you file under
Once you file you are protected by an automatic stay against collection activities, lawsuits against you, and any attempts to collect debts. Violations of this stay by creditors makes them liable for damages. The stay takes effect the moment I file your bankruptcy petition from my computer while you are still sitting in my office. Clients like leaving my office being sure that they are protected.
Note that now under the new law if you have had an active bankruptcy case within the past year of your filing of this case the stay only lasts for 30 days unless the judge orders that the stay is extended. If you have had two or more cases during the past year there is no stay at all until the judge orders one if the judge orders one. The lesson to be learned is file once and file right!
If you want to be considered for filing the same day as your appointment, it is important that you finish your credit counseling including the final telephone component at least the day before your appointment. Click here to make an appointment. Additionally, you should also have completed the online intake form fully including the gross income figures for the last 6 months before the current month. Emergency filings have risks and should not be undertaken lightly. It is important that we have as much information as possible available before we file.
BEST FEATURES:
-Least expensive total cost.
-Quickest discharge.
MAIN DISADVANTAGE:
-The entire fee has to be paid before filing.
In Chapter 7 you can keep your exempt property which is almost always all your property for those who live in Texas. Very few people have non-exempt property that has to be given up. You are required to attend a creditors meeting which in almost all cases is just a five minute affair where you are asked why you filed bankruptcy. After the creditors meeting you typically receive your discharge within 4-6 months. Some debts are not dischargeable but most of your debts will probably not fall within these narrow categories. As long as you are current on your payments to securecd creditors I can almost always arrange for you to keep the collateral. If you can pay the current value of the collateral in full you can redeem it to extinguish a creditor's lien. Note that once you receive a Chapter 7 discharge you cannot get another one for eight years, so if you have to file bankruptcy again before that you are limited to Chapter 13 in most cases. Call to get more information.
In Chapter 11 you have more flexibility than the other chapters in that there is more time to propose a reorganization plan. The main disadvantages are the high cost and that creditors who receive less than their full claim or whose rights are otherwise modified have the right to vote on your reorganization plan. Generally chapter 11 is a last resort for consumers who do not qualify for Chapter 13, but in some cases it may be preferred such as when more time is needed to file a reorganization plan.
ELIGIBILITY: You (and your spouse if both file) must be a family farmer and either A) owe less than $1,500,000 in total debts, excluding debt on your home if that debt is not farm related, 80% of the debts must be from farming, and more than 50% of your gross taxable income from last year comes from farming,
or B) you have a farming corporation or partnership which is more than 50% owned by your family and your relatives, assets are 80% related to farming, debts are less than $1,500,000 excluding a home where you or another owner of the farm lives, and 80% of debts related to farming, and if a corporation it is not publicly traded on a stock exchange.
Chapter 12 is a reorganization proceeding that lasts 3-5 years. You receive a discharge of most debts at the end. During the proceeding you must give up any excess income after your living expenses are deducted. This income is used to pay creditors and expenses such as attorney's fees.
BEST FEATURES:
-Least money down.
-Best opportunity to to stop repossessions and foreclosures and catch up.
-Best discharge with the fewest exceptions.
ELIGIBILITY: You (and your spouse if both file) must owe less than $1,010,650 in secured debt and less than $336,900 in unsecured debt, not counting debt that is contingent, unliquidated, or subject to bona fide dispute. For those spouses above the debt limits you may be able to file two separate Chapter 13 cases if each spouse falls below the limits. You cannot file Chapter 13 for a corporation or partnership.
Chapter 13 is a reorganization proceeding that lasts 3-5 years. You receive a discharge of most debts at the end. During the proceeding you must give up any excess income after your living expenses are deducted. This income is used to pay creditors and expenses such as attorney's fees.
“At the end of the seventh year you are to cancel the debts of those who owe you money.”
Deuteronomy 15:1
“Honest people are routinely taken advantage
of by powerful banks and finance companies
who know the rules. My goal is to level the
playing field.”
Alex Wathen
These are the silly disclaimers I am required to put here:
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
Licensed to practice law in Texas, the United States District Court for the Southern District of Texas, the United States Courts of Appeals for the First, Third, Fourth, Fifth, Sixth, Eighth, Ninth, Tenth, and Eleventh Circuits, as well as the United States Supreme Court. This site is neither sponsored, endorsed or approved by the law firm of Kubosh & Associates. Alex Wathen is solely responsible for its contents. This site provides only general information and is not a substitute for a face to face consultation with a bankruptcy attorney such as Alex Wathen. Neither is there ever an attorney client relationship created by the use of this site including the submission of any bankruptcy questions or other information. For more information contact Alex Wathen, 10333 Northwest Freeway, Suite 503, Houston, TX 77092, (281) 999-9025