Chapter 7 and Chapter 13

Most people may be wondering what the difference is between Chapter 7 and Chapter 13. Under Chapter 7, all a person's debt is forgiven. That means the person does not have to pay any of the money back. Certain things like student loans and tax debt cannot be included in a Chapter 7 filing. Under a Chapter 13, the person works with a trustee of the court to repay all of the debt. Home loans after bankruptcy can help greatly with a Chapter 13 filing because the filer could refinance or take out a second mortgage and use the equity from the house to help repay the debt. Most can get a mortgage no matter how bad a credit history is. A home loan after bankruptcy can actually help improve a financial situation and rebuild a credit report.