I found this article on ProPublica written by Paul Kiel on Sept. 27, 2017: Bankruptcy: What’s the Difference Between Chapter 7 and Chapter 13? The article starts, "The two main bankruptcy options available to people overrun by consumer debt are Chapter 7 or Chapter 13. The options differ greatly in how they work and the relief they provide." It is easy to read and explains the difference nicely. In a nutshell: "Chapter 7 is a form of liquidation, meaning the debtor’s assets are divvied up among creditors. However, 95 percent of cases involve debtors who do not have assets above the legal threshold...
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Chapter 13 is a form of repayment plan. The debtor’s obligations are combined in one, regular payment (although certain ongoing obligations like utility bills might be paid outside the plan) calibrated to the debtor’s income. A Chapter 13 plan often involves paying a portion of unsecured debts...
While some of the information differs from this jurisdiction, I think the article is helpful. I also found some of the statistics interesting as well. The author discusses attorneys: "How does having an attorney affect someone’s chances? Debtors who are represented by attorneys tend to fare far better than those who aren’t. Only about 8 percent of debtors who filed under Chapter 7 from 2008-2015 did so without an attorney’s help. About 72 percent of those cases ended in the debt being discharged. By comparison, debtors who were represented by attorneys received discharges 98 percent of the time. About 9 percent of debtors who filed under Chapter 13 from 2008-2015 did so without an attorney’s help. It is very rare for such cases to reach discharge. Only about 4 percent of the Chapter 13 pro se cases filed from 2008-2010 ended in discharges..." The article has good information and gives a reader a broad sense of bankruptcy. Keep in mind different states and district courts may have different local practices.
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