What Is the Difference Between Chapter 7 and Chapter 13?
Chapter 7 bankruptcy erases most unsecured debts in about three to six months by liquidating non-exempt assets — though Florida’s generous exemptions mean most filers keep everything they own. Chapter 13 reorganizes your debts into a 3–5 year repayment plan, letting you keep your property and catch up on missed mortgage or car payments.
Two Very Different Tools
Chapter 7 and Chapter 13 are the two most common types of consumer bankruptcy, but they solve different problems. Chapter 7 is a “liquidation” bankruptcy: a trustee reviews your assets, sells anything not protected by an exemption, and the court discharges most of your unsecured debt — credit cards, medical bills, personal loans. Chapter 13 is a “reorganization”: you keep your assets and repay some or all of your debt through a court-approved plan over three to five years.
How Chapter 7 Works
Chapter 7 is the faster, cheaper option. The court filing fee is $338, and most cases end in discharge within three to six months. To qualify, you must pass the means test: if your household income is below Florida’s median for your household size (roughly $68,000 for a single filer under the figures effective April 2026), you generally qualify automatically. Above that, a second calculation of your disposable income decides eligibility.
Despite the word “liquidation,” most Florida Chapter 7 filers lose nothing. Florida’s exemptions are among the strongest in the country — an unlimited homestead exemption (within acreage limits), a $5,000 motor vehicle exemption (raised from $1,000 in July 2024), and a $4,000 wildcard for filers who don’t use the homestead exemption.
How Chapter 13 Works
Chapter 13 costs $313 to file and runs much longer: you propose a repayment plan lasting three to five years, funded by your regular income. In exchange, you keep all your property — even non-exempt assets — and you gain powerful tools Chapter 7 doesn’t offer, like the ability to catch up on mortgage arrears over the life of the plan and stop a foreclosure.
Chapter 13 has eligibility ceilings: for cases filed between April 1, 2025 and March 31, 2028, your secured debts must be under $1,580,125 and unsecured debts under $526,700. You also need regular income sufficient to fund the plan.
Which One Is Right for You?
Chapter 7 usually fits filers with mostly unsecured debt, income below the median, and no assets at risk. Chapter 13 usually fits filers who earn too much for Chapter 7, are behind on a mortgage or car they want to keep, or have non-exempt assets to protect. There are also credit differences: Chapter 7 stays on your credit report for 10 years from filing, Chapter 13 for 7 years.
The choice is rarely obvious from a checklist — the right chapter depends on your income history, your equity, and what you’re trying to protect. That’s a conversation worth having with an attorney before you file anything.
Chapter 7 and Chapter 13 in Miami-Dade County
Miami-Dade bankruptcy cases are filed in the U.S. Bankruptcy Court for the Southern District of Florida, which sits in downtown Miami. Arturo R. Alfonso P.A. has guided Miami families through both chapters for over 35 years, in English and Spanish, from Brickell to Kendall to Cutler Bay. If you’ve been searching for a bankruptcy attorney near me in Miami, we offer consultations that start with the question that matters most: which chapter actually serves your situation — or whether bankruptcy is even necessary at all.
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