Chapter 7, 11, 12, & 13 Bankruptcy
Understanding Which Path is Right for Your Financial Future
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Which Chapter is Best for Me?
There are four primary chapters of the federal bankruptcy code under which an individual or business may file. Every case begins with a Bankruptcy Petition—a public document that provides a full disclosure of your assets, debts, income, and expenses. For Chapters 11, 12, and 13, you must also file a plan for financial reorganization.
At Krupp Law Offices P.C., we help you navigate these choices to ensure you retain the maximum amount of property allowed by law.
Chapter 7: Liquidation
Often called "Fresh Start" bankruptcy, Chapter 7 is designed for those unable to pay back their debts. It typically lasts about four months and results in a complete discharge of unsecured debts (like credit cards and medical bills).
- Secured Debt: You can usually keep your home or car if you continue making payments.
- Non-Dischargeable: Certain taxes, student loans, child support, and alimony generally cannot be eliminated.
- Cost: Attorney fees typically range from $900–$1,500, plus a court filing fee.
Chapter 13: Reorganization
Chapter 13 allows you to propose a 3-to-5 year plan to pay back a portion of your debt based on your ability to pay, not the total amount owed. This is often the best choice for those trying to stop a foreclosure or keep a vehicle with past-due payments.
- Advantage: Allows you to catch up on missed mortgage or car payments over time.
- Cost: Attorney fees are usually around $3,000 (often payable through the plan), plus a court filing fee.
Specialized Filings: Chapters 11 & 12
Chapter 11 (Business)
Primarily for business reorganization, allowing a company to stay operational while restructuring its debt. It is also available to individuals with very high debt levels.
Chapter 12 (Farmers)
Specifically designed for family-owned farms or commercial fishing operations to provide a path to debt relief tailored to their seasonal income.
Maximize Your Exemptions
The law allows you to protect significant assets. Current federal exemptions include up to $27,900 in home equity and $4,450 in vehicle equity. You may also choose Michigan state exemptions if they are more advantageous for your specific assets.
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Expert Guidance
With over 85 years of experience, we know how to find the right solution for you.
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