Bankruptcy is a legal process designed to provide relief to individuals and businesses
overwhelmed by debt. Two common types of bankruptcy filings available for individuals within
Pennsylvania are Chapter 7 and Chapter 13. While both aim to help debtors achieve a fresh
financial start, they differ significantly in terms of eligibility, procedures, and outcomes. In this
article, we will explore the key differences between Chapter 7 and Chapter 13 bankruptcy,
enabling you to gain a better understanding of each and choose the most appropriate option for
your unique circumstances.
Chapter 7 Bankruptcy:
Chapter 7 bankruptcy, often referred to as "liquidation bankruptcy"; involves the sale of a
debtor's non-exempt assets to repay creditors.
Here are the essential aspects of Chapter 7 bankruptcy:
1. Eligibility: Chapter 7 bankruptcy is available to individuals, married couples, partnerships, and
corporations. However, eligibility is subject to meeting certain criteria, primarily based on