The two most common bankruptcies are Chapter 7 and Chapter 13. They each have their own unique features:
Chapter 7
1. Discharges mainly unsecured debts (i.e. medical expenses, credit cards, and judgments) without requiring any repayment
2. Stops all creditor collection activities
3. Gives you a fresh start to begin rebuilding your credit
Chapter 13
1. Is a “rehabilitation bankruptcy,” which puts you on a 3 to 5 year repayment plan to pay off a substantial portion of your debts.
2. Also halts creditor collections.
3. Has a number of advantages in avoiding foreclosure and repossession.
4. Does not require any liquidation of your assets.