What is Chapter 13 Bankruptcy?
Chapter 13 bankruptcy is the second most common type of bankruptcy in Nevada. Chapter 7 bankruptcy is the most popular type of bankruptcy in Henderson and Las Vegas. There are definite differences between ch 13 and ch 7 bankruptcy. While chapter 7 Bk wipes away all of your debts (With no repayment plan), whereas, Ch 13 bankruptcy, the filer repays a portion of their debt through the chapter 13 bankruptcy repayment plan.
Additionally, there are income requirements in a Nevada chapter 7 bankruptcy. Usually qualifying for chapter 7 bankruptcy is determined by the bankruptcy means test. If you are below the Nevada median income for your household size, you will more than likely qualify for a chapter 7. However, in a chapter 13 bankruptcy you can qualify to file regardless of whether your income is below the Nevada median income level or whether you pass the means test. Nonetheless, your income will play a factor in determining whether filing a Chapter 13 case in Nevada is a feasible option for you.
Also known as a “wage earner’s bankruptcy” or a “bankruptcy of reorganization”, Chapter 13 bankruptcy is particularly helpful if trying to get caught up on back house payments to avoid foreclosure. In contrast, a Chapter 7 bankruptcy requires no repayment, whereas, a Chapter 13 requires you to repay a portion, or all of your debts back in order to successfully complete your case and receive a full bankruptcy discharge. Thus, you will need to show that you receive enough income to keep up with your payments for the duration of your Chapter 13 case.(Usually 3-5 years of repayment).
Differences Between Filing Chapter 13 and Chapter 7 Bankruptcy in Las Vegas
Also, Filing Chapter 13 bankruptcy in Las Vegas is best for people who wish to keep their assets (Like a home, vehicle, etc…). Whereas, Chapter 7 bankruptcy is better suited for people in Las Vegas who have few assets. The duration of the bankruptcy case is another major difference between the bankruptcy chapter. A Chapter 7 bankruptcy case in Nevada generally lasts for about 4 to 6 months from filing to discharge. Contrastly, Filing a Chapter 13 bankruptcy in Las Vegas lasts between 3 to 5 years, dependant upon the length of your repayments. After Filing Chapter 13 Bankruptcy in Las Vegas, you will be making monthly payments to your assigned trustee for 3-5 years.