Two main types of bankruptcy are available to individual consumers: Chapter 7 and Chapter 13. Each type has its own set of rules, eligibility criteria, and benefits, and it’s crucial to understand the differences between them before deciding which one to pursue.

Chapter 7 Bankruptcy

Chapter 7 bankruptcy, or liquidation bankruptcy, is designed for those with little or no ability to repay their debts. In this process, a bankruptcy trustee will sell the debtor’s non-exempt assets to pay off creditors. Most remaining unsecured debts will then be discharged, providing the debtor with a clean slate.

Chapter 13 Bankruptcy

Chapter 13 bankruptcy, or reorganization bankruptcy, is intended for individuals with regular income who want to repay a portion of their debts over time. In this process, the debtor proposes a payment plan to repay their debts, typically three to five years. Upon successful completion of the plan, the remaining eligible debts are discharged. Chapter 13 allows debtors to keep their property, such as a home or car, as long as they continue making payments under the plan.


Meet Jay

Since I became a lawyer in 1995, I’ve represented people with problems involving student loans, consumer debts, mortgage foreclosures, collection abuse, and credit reports. Instead of gatekeeping my knowledge, I make as much of it available at no cost as possible on this site and my other social channels. I wrote every word on this site.

I’ve helped thousands of federal and private student loan borrowers lower their payments, negotiate settlements, get out of default and qualify for loan forgiveness programs. My practice includes defending student loan lawsuits filed by companies such as Navient and National Collegiate Student Loan Trust. In addition, I’ve represented thousands of individuals and families in Chapter 7 and Chapter 13 bankruptcy cases. I currently focus my law practice solely on student loan issues.

I played a central role in developing the Student Loan Law Workshop, where I helped to train over 350 lawyers on how to help people with student loan problems. I’ve spoken at events held by the National Association of Consumer Bankruptcy Attorneys, National Association of Consumer Advocates, and bar associations around the country. National news outlets regularly look to me for my insights on student loans and consumer debt issues.

I’m licensed to practice law in New York and California and advise federal student loan borrowers nationwide.

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