When you file for Chapter 13 bankruptcy, you must do so by establishing a payment plan to pay back all or some of the debts you owe over time. The amount of debt you’ll have to repay depends on how much you earn and how much debt you have. In Chapter 7 bankruptcy, however, you request that all of the debts be eradicated through the discharge process. In exchange for this the bankruptcy trustee does have the ability to take any non-exempt property you own and distribute the proceeds out to your creditors.

When you file for Chapter 13 bankruptcy, you do not lose any property because the repayment plan is funded through your income. In Chapter 7 bankruptcy, however, you may choose some property that you are allowed to keep from a list of specific New York State exemptions. In a Chapter 7 bankruptcy, you can keep your secured items—physical items  such as a car—as long as you agree to keep the terms of its lease or financing agreement and continue to make the required payments. It might feel confusing or overwhelming to figure out which kind of bankruptcy is the right one for you, but thankfully it’s not a decision you have to make on your own.

To determine which type of bankruptcy is most appropriate for you it is important to schedule a meeting with a New York bankruptcy attorney as soon as possible. During an initial consultation, discuss your circumstances with your attorney to determine if one type is more appropriate than another. In order to go with Chapter 13, you’ll need to commit to a payment plan, and this is frequently the biggest determining factor to help you decide whether Chapter 13 is the right choice for you.

Getting a better handle on what to expect and what is required with filing will leave you feeling more prepared about the process and more confident in your own decision. Don’t hesitate to get help from an attorney sooner rather than later. Jayson Lutzky is a Bronx, NY attorney handling personal bankruptcies. He has over 32 years of experience practicing law and offers free in-office consultations. Call 718-514-6619 to set up an appointment and move on from your debt. Visit www.MyNewYorkCityLawyer.com to learn how you can be get a fresh financial start.