What is Bankruptcy?
The debtor files a bankruptcy petition and states the reason for not paying the creditor the money he owed. Before filing for bankruptcy a court procedure is linked with it. This helps the debtor to get relief from debt. But in recent times a lot of myth is associated regarding bankruptcy. Due to lack of proper awareness, people harbor notion against it.
In California and US there are two popular consumer bankruptcy : Chapter 7 and Chapter 13. The bankruptcy lawyers can prove to be of real help in the court proceedings.

Difference between chapter 7 and chapter 13:
A Chapter 7 bankruptcy is also known as a liquidation bankruptcy. In order to render money to the creditor, the filer has to surrender all his non- exempted property to the court. The payment to the creditor would be made after the assets are sold off. Car, homes, retirement accounts are few of the things that the debtor has the provision to keep under chapter 7 bankruptcy.
In Chapter 7 bankruptcies there are 3 factors for the filers:
1) Chapter 7 Bankruptcy is usually filed by people with unstable income.
People who hoard assets that fall under taxable property such as home, vehicles, and retirement accounts.
They would faulter to pay on a regular basis on the repayment program.

In Chapter 13 the filer submits a stipulated amount to the court. It paves the way for the repayment plan. It is a 5 year plan within this definate period the filer has to repay the money. The repayment plan is structured in such a way that it would be affordable for the debtor to pay back. The filer can free himself from the shackles of debt when the payment plan is approved by the court and once the amount has been disbursed to the creditors.
Chapter 13 bankruptcy is a good option for people who:
1) Are not willing to lose their non-exempted property
Have a stable and regular income
Can afford to maintain a disciplined payment program

So this article has shown you a comparative analysis between chapter 7 and chapter 13 bankruptcy. The should be aware of his financial status before filing for either of it.