| a).
| Chapter
13's are purely voluntary--unlike Chapter 7 or 11, where creditors can file an
involuntary petition against the debtor.
|
| b).
| After
filing, a debtor may dismiss his case at any time during the proceedings--in Chapters
7 and 11, on the other hand, the right to dismiss is severely limited. |
| c).
| The
debtor retains all of his property, exempt and nonexempt, and no assets are seized
by the trustee. The only property that goes to the trustee is the debtor's post-petition
earnings or other source of plan payment. |
| d).
| The
debtor is not required to deal directly with his creditors. The trustee acts as
essentially as debtor's disbursing agent, collecting monthly payments from the
debtor and periodically remitting them to creditors. |
| e).
| Only
the debtor (not the creditors or the trustee) may file a Chapter
13 plan. |
| f).
| Creditors
are not allowed to vote on the plan. In Chapter
11, creditors are allowed to vote on the plan and the plan must generally
receive a simple majority (2/3 majority in money amount) of votes to be confirmed.
Creditors and the trustee may object to confirmation of the plan, but the plan
can be confirmed over such objections if the Court finds that the debtor has met
all the requirements of 11 U.S.C. Section 1325(a). |
| g).
| A
debtor whose home is in foreclosure may file Chapter 13 and stop the foreclosure,
and cure the delinquent payments over a 3-5 year period. During the case, he is
required to keep the post-bankruptcy payments current. This is not available in
Chapter 7. |
| h).
| A
debtor who has a trust deed or mortgage in second priority position on his home
or other real estate may "strip off" that lien completely, if the court
finds that the property is not worth more than the first mortgage or trust deed.
In this instance, the claim is treated as completely unsecured, and provided
the same repayment treatment as credit card and other such debts. Lien stripping
is not available in Chapter 7. |
| i).
| Chapter
13 is generally less expensive than Chapter 11, in terms of attorney's
fees, court fees, and other costs. |
| j).
| A
debtor who may not obtain a discharge in Chapter 7 based on the "means test",
may be able to obtain Chapter 13 relief. |
| k).
| A
debtor who has gotten a Chapter 7 (or Chapter 11) discharge in a case commenced
within the past 8 years, can file Chapter 13 and receive a discharge, but not
another Chapter 7 or 11. |
| l).
| There
is a "co-debtor stay" in Chapter 13, limiting creditors' collection
efforts against co-signers on consumer debts. No such stay exists in Chapters
7 or 11. |
| m).
| Taxes
that are not
dischargeable in Chapter 7 can be paid off in a 3-5 year Chapter 13 plan,
without payment of interest and penalties past the petition date. |
| n).
| Credit
reporting agencies generally report Chapter 7 filings for 10 years, but Chapter
13 filings for only 7 years. |
| o).
| It
is possible that future creditors will view a Chapter 13 more favorably than a
Chapter 7, due to the debtor's attempt to pay back at least a portion of his debt. |