Chapter 7 vs. Chapter 13 Bankruptcy: Which Is Right for You?

Financial hardship can strike anyone, often without warning. If you’re overwhelmed by mounting bills, creditor calls, or the threat of losing your home, bankruptcy may offer a chance to start over. But one of the most common questions people ask is: What’s the difference between Chapter 7 and Chapter 13 bankruptcy — and which option is right for me?

At Buenaventura Koss, PLLC, we help individuals and families throughout Tampa, Florida, understand these options so they can make informed, confident decisions about their financial future.

Understanding the Two Main Types of Consumer Bankruptcy

Chapter 7 Bankruptcy — “Liquidation” or Fresh Start

Chapter 7 bankruptcy is often called a “fresh start” because it allows you to eliminate many unsecured debts such as:

• Credit card balances
• Medical bills
• Personal loans
• Certain judgments

When you file for Chapter 7, the court issues an automatic stay, which stops creditor collection efforts immediately — including wage garnishments, repossessions, and phone calls.

A court-appointed trustee may sell certain non-exempt assets to repay creditors, but most people who file Chapter 7 in Florida can keep their property thanks to generous state exemptions. For example, Florida’s homestead exemption protects your primary residence, and other exemptions protect vehicles, personal items, and retirement accounts.

Who Qualifies:
Eligibility for Chapter 7 depends on your income and ability to repay debts. You’ll need to pass a means test, which compares your income to the median household income in Florida. If your income is below that threshold, or your disposable income is minimal, Chapter 7 may be available.

How Long It Takes:
A typical Chapter 7 case lasts about four to six months, ending with a discharge that wipes out eligible debts.

Chapter 13 Bankruptcy — “Reorganization” or Repayment Plan

Chapter 13 bankruptcy is designed for people who have steady income and want to keep their property while catching up on overdue debts. Instead of selling assets, Chapter 13 allows you to create a structured repayment plan lasting three to five years.

Under this plan, you make one monthly payment to a court-appointed trustee, who distributes the funds to your creditors. At the end of the plan, remaining eligible debts are discharged.

Who Qualifies:
Chapter 13 is ideal for individuals who:

• Are behind on mortgage or car payments but want to avoid foreclosure or repossession
• Have valuable property they wish to keep
• Earn too much to qualify for Chapter 7
• Have debts that can be managed through reorganization

How Long It Takes:
Most repayment plans run between three and five years. During that time, you remain protected from creditor collection through the automatic stay

Which Type Is Right for You?

Choosing between Chapter 7 and Chapter 13 depends on several factors, including your income, debt type, and goals.

Chapter 7 may be better if:

• You have limited income and can’t keep up with minimum payments
• Most of your debts are unsecured (like credit cards or medical bills)
• You don’t have significant non-exempt property at risk

Chapter 13 may be better if:

• You want to save your home from foreclosure
• You’re behind on car or mortgage payments
• You have a steady income to make manageable monthly payments
• You need time to reorganize and protect your assets

Each situation is unique, and filing under the wrong chapter could lead to unnecessary complications or even case dismissal. That’s why it’s important to review your full financial picture with an attorney who understands how bankruptcy laws apply in Florida.

How Buenaventura Koss, PLLC Can Help

At Buenaventura Koss, PLLC, we know that deciding to file for bankruptcy can feel overwhelming. Our attorneys work closely with each client to evaluate income, debts, and long-term goals before recommending a path forward.

We can help you:

• Determine whether Chapter 7 or Chapter 13 best fits your needs
• Protect your property under Florida’s exemption laws
• Stop wage garnishments and creditor harassment
• File correctly and stay compliant with court requirements
• Rebuild financial stability after your case is complete

Our goal is to guide you toward a stronger financial future — one where you can move forward free from overwhelming debt and creditor pressure.

Take the First Step Toward Financial Relief

If you’re unsure which form of bankruptcy is right for you, don’t face the decision alone. The attorneys at Buenaventura Koss, PLLC can help you understand your options, protect what matters most, and take control of your financial life again.

Call 813-519-5100 or visit www.thebklaw.com to schedule a confidential consultation today.