The Texas Answer in One Paragraph
Texas filers choose between Chapter 7 (liquidation, 3-4 months, strong discharge rate) and Chapter 13 (3-5 year repayment plan, better for saving a home from foreclosure or for filers above the means test). Three Texas-specific inputs drive the choice: (1) the Texas means test median of $66,837 for a 1-person household, (2) the Texas homestead exemption of Unlimited (10 acres urban, 100 rural), and (3) the local filing mix and outcome data below. Everything else on this page is elaboration on those three factors.
Quick Side-by-Side
Chapter 7 in Texas
Chapter 13 in Texas
Texas Means Test Thresholds (April 2026)
Texas's single-person median of $66,837 sits near the national midpoint. Filers close to the line should compute a careful 6-month average -- one high month (bonus, overtime, commission spike) can flip Part 1 from pass to fail.
| Household Size | Texas Median Income |
|---|---|
| 1-person household | $66,800 |
| 2-person household | $86,900 |
| 3-person household | $101,600 |
| 4-person household | $118,300 |
| 5-person household | $128,300 |
| 6-person household | $138,400 |
For household sizes above 6, add $11,100 per additional member. Full details at the Texas means test calculator. For a general discussion, see our means test overview.
Texas Homestead Exemption and the Chapter Choice
Texas has an unlimited (or nearly unlimited) homestead exemption under Tex. Prop. Code 41.001. That is a powerful Chapter 7 protection: you can keep a home with very substantial equity and still wipe out your unsecured debt. Federal BAPCPA restrictions (11 U.S.C. Section 522(p) -- $214,000 cap for property acquired within 1,215 days) can limit this in a narrow set of cases. Homeowners in Texas should almost always model Chapter 7 before considering Chapter 13.
Texas lets filers choose between state exemptions and the federal bankruptcy exemption scheme (11 U.S.C. Section 522(d)). Review the full exemption list at bankruptcyexemptionsbystate.com/texas before assuming any specific asset is safe.
Homestead amount (Texas): Unlimited (10 acres urban, 100 rural). Statute: Tex. Prop. Code 41.001.
Texas's Chapter 7 vs Chapter 13 Filing Mix
Warning sign: Texas's Ch. 7/13 mix is unusual. Of 30,781 consumer cases in the federal database, 61.5% are Chapter 13 and only 38.5% are Chapter 7. That is the inverse of the national average (where Chapter 7 accounts for roughly two-thirds of filings). This pattern is driven in part by local practitioner habit, trustee posture, and court-level plan-confirmation dynamics. If a Texas attorney steers you toward Chapter 13, ask explicitly why Chapter 7 is not the right fit for your facts -- not for the local default.
Why does filing mix matter? Attorney fee structures often favor Chapter 13 (paid through the plan rather than up-front), which can produce local-market bias toward Chapter 13 that is not driven by individual debtor facts. FJC data lets you see whether Texas's mix matches the economics of the typical filer's situation.
Texas Federal Court Data
Numbers below come from the Federal Judicial Center Integrated Database, covering 30,781 consumer bankruptcy cases filed in Texas's federal bankruptcy courts.
| Chapter | Cases Filed | Discharge Rate (resolved) |
|---|---|---|
| Chapter 7 | 11,844 | 98.0% |
| Chapter 13 | 18,937 | 36.8% |
Outcomes in Texas differ sharply between the chapters. Of resolved Chapter 7 cases in the FJC database, 98.0% end in discharge. Of resolved Chapter 13 cases, only 36.8% end in discharge; the remaining 63.2% are dismissed before the plan completes. If you are physically able to file either chapter, this gap is a reason to think hard before committing to a 3-5 year Chapter 13 plan in Texas.
Which Chapter Fits Which Texas Filer?
- If your income is below the Texas median ($66,837, 1-person) and you own little non-exempt property: Chapter 7 is almost certainly the right choice. Fast, cheap, and the highest discharge rate in consumer bankruptcy.
- If you are behind on your mortgage or car loan and want to keep the collateral: Chapter 13 lets you cure arrears over 36 to 60 months while the automatic stay blocks foreclosure and repossession.
- If a Texas attorney steers you to Chapter 13 despite passing the means test: get a specific, written reason tied to your assets, income, or debts. Local default in Texas is Chapter 13-heavy; your facts may still fit Chapter 7.
- If you have high home equity and Texas caps the homestead exemption: run the numbers on Chapter 13 cramdown, lien stripping (for wholly underwater junior liens), and the federal BAPCPA homestead cap before assuming Chapter 7 is safe.
- If you have filed before within the lookback windows: use the 1328(f) discharge screener first -- a prior Chapter 7 discharge bars another Chapter 7 for 8 years, and a prior Chapter 13 discharge bars another Chapter 13 for 2 years.
Rule of thumb for Texas: if you qualify for Chapter 7 on the means test AND your home equity is within the Unlimited (10 acres urban, 100 rural) homestead, Chapter 7 is almost always the right choice. Chapter 13 is the right answer when specific facts (arrears, non-exempt equity, prior Chapter 7 within 8 years) rule Chapter 7 out.
Frequently Asked Questions
Is Chapter 7 or Chapter 13 better in Texas?
For most Texas filers who pass the means test, Chapter 7 is faster, cheaper, and succeeds more often. Chapter 13 is the right choice if you need to save a home from foreclosure, cure arrears, catch up on priority taxes, or cannot qualify for Chapter 7.
What is the Chapter 7 income limit in Texas?
There is no hard dollar limit. The means test compares your 6-month average income (annualized) to the Texas median for your household size. One person: $66,837. Four person: $118,300. Above-median filers can still qualify by running Part 2 expense deductions.
Can I use federal bankruptcy exemptions in Texas?
Yes. Texas is an opt-in state -- filers may choose federal exemptions under 11 U.S.C. Section 522(d) instead of state exemptions. Compare both schedules before filing; federal can offer a larger wildcard while state may offer a larger homestead.
How much home equity is protected in Texas bankruptcy?
Texas's homestead exemption protects Unlimited (10 acres urban, 100 rural) under Tex. Prop. Code 41.001. Federal BAPCPA limits (11 U.S.C. Section 522(p)) can cap this at approximately $214,000 for a residence acquired within 1,215 days of filing.
How long does bankruptcy take in Texas?
Chapter 7 takes 3 to 4 months from filing to discharge in Texas federal bankruptcy court. Chapter 13 takes 3 years (below-median) or 5 years (above-median) of monthly plan payments before discharge.
Can I switch from Chapter 13 to Chapter 7 in Texas?
Yes. Under 11 U.S.C. Section 1307(a), a Chapter 13 debtor in Texas generally has the right to convert to Chapter 7 at any time, as long as the case was not previously converted from Chapter 7. You must still pass the means test at the time of conversion.
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Last updated: 2026-04-18. Not legal advice. Statutory homestead and median-income figures are reproduced from public sources and may lag statutory amendments -- verify against current state statute before relying.
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