To the extent you do not pay off your debts during a Chapter 13 payment plan, the remaining balance is usually legally written off forever.
Both Chapter 7 and Chapter 13 can wipe away judgment liens. But doing so under Chapter 13 can be better when used with its other benefits.
If you are behind on property taxes on your home, Chapter 7 often doesn’t give you enough time to catch up. But Chapter 13 likely would.
“Stripping” off a second mortgage has major immediate and long-term benefits.
You have much, much more time to catch up on unpaid mortgage payments, as well as any unpaid property taxes.
Chapter 13 can be an effective way to keep or unload business and investment real estate.
Chapter 13 is often a better way to get sell real estate, especially if you have other financial complications.
A support obligation is a very special kind of debt, and the resulting lien on your home has to be dealt with in a very special way.
Chapter 13 forces the IRS/state to accept only partial payment on an income tax debt that is only partially secured by a tax lien.
If your second (or third) mortgage is not backed by any equity in your home, you can “strip” that mortgage off your home’s title.
Chapter 13 gives you much more time to catch up on your unpaid mortgage payments. That can be reason enough choose this option.
Keeping a vehicle and its debt is sometimes not the best option. Chapter 7 and Chapter 13 can both give you a safe way out.
In your goal of getting a fresh financial start, your most important tool is the “discharge”–the permanent legal elimination of your debts.
Your debts can be “secured,” “priority,” or “general unsecured.” How bankruptcy treats your debts depends on which kind they are.
Bankruptcy gives you options for taking charge of your financial life.