Chapter 7 vs Chapter 13 Bankruptcy in Pennsylvania: Which Is Right for You?
Most Pennsylvania filers spend more time agonizing over "Chapter 7 vs Chapter 13" than they need to. The right chapter is usually obvious once you answer three questions: What is your income? Do you own a home you're behind on? And how much non-exempt property do you have?
The 60-second comparison
| Chapter 7 | Chapter 13 | |
|---|---|---|
| What it does | Wipes unsecured debt (credit cards, medical, most personal loans) | Consolidates debt into a 3–5 year repayment plan |
| Eligibility | Must pass the PA means test | Must have regular income; debt under federal caps |
| Timeline | ~4 months | 3 or 5 years |
| Court filing fee (2026) | $338 | $313 |
| Typical attorney fee in PA | $1,200–$2,000 | $3,500–$5,000 (often paid through the plan) |
| Keep your house if behind on mortgage? | No — Chapter 7 cannot cure arrears | Yes — arrears get paid through the plan |
| Keep non-exempt property? | Trustee can sell it | Yes — you pay its value into the plan |
| Effect on credit report | 10 years | 7 years |
Pick Chapter 7 if…
- Your household income is at or below the Pennsylvania median for your family size (passes the means test automatically).
- Most of your debt is unsecured — credit cards, medical bills, personal loans, old utilities, deficiency balances after repossession.
- You are current on your mortgage and car loan (or willing to surrender them).
- Your assets fit within Pennsylvania's exemption scheme — usually the case for renters and homeowners with modest equity.
Pick Chapter 13 if…
- You earn too much to pass the means test.
- You are behind on your mortgage and want to keep the house. Chapter 13 is the foreclosure-stopper of choice in PA.
- You owe back taxes, domestic support, or other priority debt that Chapter 7 cannot discharge.
- You have significant non-exempt equity (a paid-off second car, investment property, a coin collection) you want to protect.
- You filed Chapter 7 within the last 8 years and aren't eligible for another discharge yet.
The Pennsylvania-specific wrinkle
PA filers almost always elect the federal exemption scheme rather than state exemptions — the federal homestead exemption is larger and there's a useful "wildcard." The exception: married couples who own a home jointly can claim Pennsylvania's "tenancy by the entireties" protection, which shields the home from one spouse's creditors entirely. If only one spouse has the debt problem, this can change the chapter analysis completely.
What about Chapter 11?
Chapter 11 is reorganization for businesses (and individuals with very high debt). For consumers, the choice is almost always between 7 and 13.
The honest answer
About 70% of consumer cases filed in Pennsylvania's federal districts are Chapter 7. It's faster, cheaper, and wipes more debt — when you qualify. Chapter 13 is the right tool when you need its specific powers: saving a home, cramming down a car loan, or curing tax arrears.
The means test result and a one-page asset snapshot are usually enough to recommend a chapter with confidence. That's what the free consultation covers.