Your income, expenses, and intentions of surrendering property will determine whether or not you qualify for a chapter 7. In a chapter 7 case you can discharge all general unsecure debts.
When you file a bankruptcy petition, it imposes something called an “automatic stay.” This is imposed without any judicial action and stops most collection actions against you or your property.
The bankruptcy automatic stay will stall or “stay” any priority unsecured debts until your case is discharged (generally after 90-120 days). Secured creditors are not allowed to repossess property, without permission from the court, even if you are behind on your payments to them. As long as the stay is in effect, creditors cannot initiate or continue lawsuits, wage garnishments, or even contact the debtor to demand payment. The court will provide notice of the case to all creditors identified by the debtor. The automatic stay also prohibits creditors from attempting to collect a consumer debt that is owed jointly with another person. When you file a Chapter 7 or Chapter 13 petition, the court appoints an impartial Trustee to administer your case. The Trustee is empowered to evaluate the circumstances of your case and serves as a disbursing agent, collecting money from you and making payments to your creditors. The Trustee will also examine your property to see if there are any luxurious items he can sell to pay creditors. There are other pros and cons to filing a chapter 7 you should discuss with a qualified bankruptcy attorney.
If one makes too much money to qualify for a chapter 7 bankruptcy in California, or they do not want to surrender their property back to secured creditors, they will likely seek a chapter 13 bankruptcy.
FONTANA CHAPTER 7 LAWYERS
PROVIDING DEPENDABLE DEBT RELIEF SOLUTIONS
Chapter 7 Bankruptcy
If you are like thousands of Americans struggling in this troubled economy, chances are you have thought about filing for bankruptcy. Bankruptcy is one way to protect yourself from creditors and help resolve your debt.
The bankruptcy lawyers at Hedtke Law APC can clear up a lot of confusion regarding your options. If you are burdened by debt and tired of harassing phone calls from collections agencies and nasty letters from mortgage companies, we are ready to help you.
Many people fear individual bankruptcy as a last resort option. However, bankruptcy can serve as a fresh start and a way out from financial difficulties. Our Fontana Chapter 7 attorneys have the skills and experience it takes to help you find real, long-lasting solutions.
No decision about your financial problems is easy. However, a Chapter 7 proceeding is among the simplest ways to alleviate your high debt burden and allow you and your family to start fresh.
In this type of bankruptcy, you are entitled to keep some of your assets, which are referred to as your “exempt” assets. The remainder of your assets are sold or liquidated. The proceeds from the sale of any property or assets are then applied to “pay down” unsecured debts that you owe, in order of their priority.
Some unsecured debts you may be able to discharge in a Chapter 7 bankruptcy include:
Once you have filed your bankruptcy petition, the automatic stay goes into effect. This ceases most collection efforts and contact attempts from creditors. This can be a welcome relief for debtors as they rebuild their finances.
Any of your remaining debts after all assets are liquidated are discharged by the court. This means that the creditors, or the companies or people to whom you owe money, can no longer attempt to collect more money from you.
Chapter 7 bankruptcy is essentially a discharge of debt and a liquidation of assets in order to satisfy creditors. First, a debtor must see if they qualify for Chapter 7 or consider other avenues like Chapter 13 or debt consolidation. You may qualify for Chapter 7 bankruptcy if you have few or no assets and/or no surplus income after your monthly expenses.
To determine whether you are eligible, you will need to file a federal form called the 22A, also known as the “Means Test.” If your income is below the state median, you are automatically eligible, although in some cases your income can be above this level.
While our debt relief attorneys can explain the qualifications in detail, we want you to be prepared for what the process will generally look like.
The primary steps of a Chapter 7 bankruptcy include:
Filing required paperwork such as your petition, schedules, and statements with the bankruptcy court clerk
Assignment of a judge and trustee are automatically assigned to your case
Attending a meeting with your attorney and Chapter 7 bankruptcy trustee, usually 30 days later
Completing a Personal Financial Management Course, and turning over any non-exempt property to the trustee to administer
Once your bankruptcy case is finalized and the court grants you a discharge, you are no longer responsible for the remaining debts that were included in your case. This will allow you to start working on rebuilding your credit and focusing on paying your current household expenses.
With a cloud of debt no longer hanging over your head, you will be able to save, budget, pay bills, and avoid future debt. With Hedtke Law APC at your side, you can finally move on to a fresh start.