Filing Chapter 13 bankruptcy after Chapter 7 bankruptcy

On Behalf of | Jun 28, 2021 | Bankruptcy |

Filing for bankruptcy in Florida or another state is never a decision to take lightly. However, it can be a good option to start over fresh with your finances if you cannot settle your debts in any other way. You may wonder if you can convert your bankruptcy by filing Chapter 13 bankruptcy after you have already filed Chapter 7.

How do Chapter 7 and Chapter 13 bankruptcy differ?

Chapter 7 bankruptcy allows you to become free of your debts. You can have most debt discharged while your nonexempt property is sold. The money from the sale of your property will then be paid out to your creditors to settle the debt.

With this type of bankruptcy, your debts are divided into secured and unsecured debt. Secured debts are those that are secured by an asset, like a car loan. Unsecured debts are things such as credit cards or medical bills. While some debts are discharged, others cannot be discharged.

Chapter 13 bankruptcy, on the other hand, allows you to reorganize your debts so that you can ultimately pay them back. All your debts are combined so that you only have to make payments to the trustee who is assigned to your case. The trustee is responsible for paying back your creditors.

Can you file Chapter 13 bankruptcy after Chapter 7?

After you have filed for Chapter 7 bankruptcy, you must wait four years to file Chapter 13 if you had debts discharged with your Chapter 7 proceeding. If you didn’t have any debts discharged when you filed for Chapter 7, you don’t have to wait and can immediately file for Chapter 13 bankruptcy. Once you file for Chapter 13, you can discharge some of your debts through that process.

An attorney may help you if you wish to file Chapter 7 or Chapter 13 bankruptcy. An attorney may provide essential advice on which option is the better one for your situation.