Chapter 7 vs. Chapter 13 bankruptcy
Most people who file for personal bankruptcy choose one of these two chapters. Here is how they differ, and how to tell which one fits your situation.
The short answer
Chapter 7 wipes out most unsecured debts, like credit cards and medical bills, in about 4 months. In exchange, a trustee can sell property that your exemptions do not protect. Most people who file Chapter 7 keep everything they own, because their property is covered by exemptions.
Chapter 13 is a 3- to 5-year repayment plan. You keep all your property and pay what you can afford through the plan. It is mainly for people who earn too much for Chapter 7, are behind on a mortgage or car loan and want to keep the property, or have property that exemptions do not fully protect.
| Chapter 7 | Chapter 13 | |
|---|---|---|
| How it works | Most debts are wiped out; a trustee may sell unprotected property | You repay part of your debts through a monthly plan |
| How long it takes | About 4 months | 3 to 5 years |
| Who qualifies | Income at or below your state's median, or you pass the full means test | Regular income, and debts under the limits ($526,700 unsecured, $1,580,125 secured) |
| Your property | Keep what exemptions protect | Keep everything |
| Behind on your mortgage or car | Does not let you catch up; the lender can foreclose or repossess after the case if you stay behind | Catch up on missed payments over the life of the plan |
| Court filing fee | $338 | $313 |
| Typical lawyer fee | About $1,000 to $3,500, paid before filing | About $3,000 to $6,000, mostly paid through the plan |
| On your credit report | Up to 10 years | Usually 7 years |
| Filing without a lawyer | Realistic for simple cases | Hard; most self-filed Chapter 13 cases are dismissed |
Chapter 13 debt limits apply to cases filed from April 1, 2025, to March 31, 2028 (11 U.S.C. § 109(e)). Filing fees in effect since December 1, 2023. Lawyer fees vary by area and case.
Do you qualify for Chapter 7? The means test
The means test decides whether you can use Chapter 7. Take your household's average monthly income over the 6 full months before you file, multiply by 12, and compare it with the median income for a household your size in your state.
- At or below the median: you qualify for Chapter 7.
- Above the median: a second calculation (Official Form 122A-2) subtracts allowed living expenses. If little is left over for creditors, you can still file Chapter 7. If not, Chapter 13 is usually the option.
Check your income with the means test calculator
The means test does not apply if most of your debts come from a business rather than personal spending.
When Chapter 7 is usually the better fit
- Your debts are mostly credit cards, medical bills, personal loans, or old utility bills.
- Your income is below your state's median.
- Your exemptions protect everything you own, or you are willing to lose what they do not.
- You are current on your mortgage and car payments, or you do not have them.
When Chapter 13 is usually the better fit
- You are behind on your mortgage and want to keep your home. Chapter 13 stops the foreclosure and lets you pay the missed amount over 3 to 5 years.
- Your income is above the median and you do not pass the full means test.
- You have property worth more than your exemptions, such as home equity or a paid-off second car, and want to keep it.
- You owe debts Chapter 7 cannot wipe out, like recent taxes or back child support, and want time to pay them while creditors are held off.
- Your car loan is more than 2½ years old (910 days) and you owe more than the car is worth. In Chapter 13 you may be able to pay only the car's value.
- You received a Chapter 7 discharge in the last 8 years, so you cannot file Chapter 7 again yet.
Debts neither chapter usually wipes out
Most student loans (unless you prove undue hardship in a separate lawsuit), child support and alimony, most recent taxes, criminal fines and restitution, and debts from drunk-driving injuries. Chapter 13 can discharge a few debts that Chapter 7 cannot, such as some property settlement debts from a divorce.
How often you can file
| Earlier case (counted from its filing date) | Wait before a new discharge |
|---|---|
| Chapter 7, then Chapter 7 | 8 years |
| Chapter 7, then Chapter 13 | 4 years |
| Chapter 13, then Chapter 13 | 2 years |
| Chapter 13, then Chapter 7 | 6 years (unless the Chapter 13 plan paid unsecured creditors in full, or at least 70% in good faith) |
11 U.S.C. §§ 727(a)(8), 727(a)(9), and 1328(f).
Can you switch chapters?
Yes. You can usually convert a Chapter 7 case to Chapter 13 if you qualify, for example to save a house. Many Chapter 13 filers convert to Chapter 7 if they lose income and cannot keep up with the plan. A lawyer can tell you whether converting makes sense in your situation.
Chapter 7 vs. Chapter 13 questions
Which is better, Chapter 7 or Chapter 13?
Chapter 7 is faster and cheaper, and most people who qualify choose it. Chapter 13 is better if you are behind on a mortgage and want to keep your home, earn too much for Chapter 7, or have property your exemptions do not protect.
Will I lose my house in Chapter 7?
Not if your equity is protected by your homestead exemption and you keep making your mortgage payments. If your equity is more than the exemption, the trustee may sell the home. Chapter 13 lets you keep it while paying for the unprotected equity through the plan.
Is Chapter 13 worse for my credit than Chapter 7?
Not usually. Credit bureaus typically remove a completed Chapter 13 after 7 years, and a Chapter 7 after 10. In practice, scores often recover within 1 to 2 years of either.
Can I file Chapter 13 without a lawyer?
You can, but it is difficult. You must write a plan that meets many legal requirements and defend it at a confirmation hearing, and most self-filed Chapter 13 cases are dismissed. Lawyers usually take most of their fee through the plan, so you do not need the full amount up front.
How do I know if I pass the means test?
Average your household's gross income over the last 6 full months, multiply by 12, and compare it with your state's median for your household size. Our free means test calculator does this for you using the latest official figures.
Not sure which chapter fits?
Our free tool runs the means test with your real numbers, checks your property against your exemptions, and flags situations where a lawyer can help.