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ishllntwnt2015

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chapter 13 vs. chapter 7?

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If there is a "good" bankruptcy (though neither will do your credit much good) it would be a Chapter 13, which is also known as the Wage Earner's Repayment Plan.  Under this program, your secured debts like a car are valued at current market value,not what you currently owe and that is the basis for repayment.  The interest is significantly lower, too.  Using this program indicates a desire to repay the debts but acknowledging that you don't have the income to pay as originally agreed.  The repayment period is 3-5 years and you pay the funds by money order to a court assigned trustee.

Under Chapter 7, you basically state you don't have the money to pay the debts and you want the court to release you from the obligation to pay the debts. This can hurt your credit for 10 years.

Best to do either with the assistance of a competent bankruptcy attorney should you decide to proceed, though I recommend trying tofind workable ways to pay the debts without resorting tosuch drastic action. 

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