Bankruptcy is the strongest tool available to fight any creditors.  It has the power and authority to halt foreclosures, repossessions, and all collections efforts immediately upon the filing of the petitions.   Bankruptcy was first implemented by Congress to assist debtors and it has continued to evolve for the benefit of many debtors.  For consumer debtors, the filing of a Chapter 7 or Chapter 13 bankruptcy will provide much needed stress relief from debtors. The Chapter 7, typically known as the straight or liquidation bankruptcy will allow debtors to clear their unsecured debts, based on an evaluation of the debtors monthly income also known as the means test.  Debtors with a wealth of credit card or medical debt typically file a chapter 7 bankruptcy.  A chapter 7 bankruptcy will halt foreclosures, repossessions and other collections effort for only a short period in time.   A chapter 13 bankruptcy is also known as the repayment plan.  Debtors who are behind on their mortgages or other secured debts typically file for chapter 13 relief.   There are a wealth of benefits provided for the debtors in chapter 13. One of the most common relief is known as the “cramdown” of vehicle liabilities.  A chapter 13 will allow the principal balance due on a vehicle note to be reduced to the fair market value of the vehicle, if the vehicle was purchased for at least 910 days.  So if you purchased a vehicle at least 910 days (approximately 2 ½  years) before the filing of the bankruptcy petition, you can possibly reduce the debt owed to the fair market value.  A chapter 13 filing also provides us an opportunity to strip additional liens on real estate property.  Please note, the filing of a bankruptcy petition has some negative effects.  Typically all credit cards accounts will be closed and your credit will be affected.