California Personal Bankruptcy Attorney
Fitzgerald & Campbell, A Professional Law Corporation
What You Need to Know About Bankruptcy
Here’s the deal on Bankruptcy. It is not the weapon it used to be. The law changed in 2005 and in net effect, less people now qualify for bankruptcy. Nor does bankruptcy cure all ills. Taxes, student loans, and judgment liens are most times still there afterwards . That said, it is still, by far, the most effective debt relief tool available to many people.
Do I Qualify?
The biggest impact of the 2005 law change was the “Means Test”, sort of a test to see if you “qualify”. It is a fairly complex math formula that has been created, taking into consideration where you live and the costs related to your income to determine what your “Means” is. If you are above a certain “Means” it is “presumed” that you do not qualify for bankruptcy. If you are below that number you are presumed to qualify. For example, that number in CA is as follows:
Here are the maximum gross annual income limits for automatically qualifying to file Ch. 7 BK in California:
This information comes from here.
What Types of Bankruptcy is There?
CHAPTER 7: If you qualify and have no assets (of significant value) a Chapter 7 bankruptcy is a very effective (some debts wiped out entirely), relatively quick (3-4 months average) and financially painless process. They are often referred to “No Asset” cases and are not terribly complex, although each case is different. The only real expense is attorney fees and court costs, so it is generally far less expensive than other alternatives.
CHAPTER 13: A hurdle for homeowners (and other secured debts like autos), is that these debts are not going to be forgiven unless you are willing to give up the house (or car) too. If you want to keep them, generally you must pay for them. You can seek Bankruptcy protection, which is why many homeowners file a Chapter 13. In a Chapter 13 Bankruptcy, a “Plan” is filed, argued, and so ordered by the judge. This Plan lays out what you are going to pay and to whom. They can also be costly. They are usually for 3-5 years and the sad truth is, A MAJORITY FAIL. The only thing worse than filing Bankruptcy, is getting kicked out of Bankruptcy court!
FITZGERALD & CAMPBELL is all about 1) getting you out of debt; and 2) for the least amount of money possible. That is what it all comes down to. What laws are available to you and how do you best use them? FITZGERALD & CAMPBELL does not just offer one debt relief option, we don’t push you in one direction. If Bankruptcy right for you, we will tell you. If it’s not, we will tell you that. If Bankruptcy is your get out of debt plan, it needs to be done right. It needs to be in the hands of experienced lawyers who have been there before. Lawyers who know what you can expect and how to get it done.
The decision to file for bankruptcy is often one of the hardest choices that a person has to make in his or her lifetime. Poor planning can often make the process even harder. It goes without saying that filing for bankruptcy should generally be a last resort, and should only be done when all other methods of satisfying one’s financial obligations have been exhausted. However, if your situation has become so severe that you are in danger of foreclosure, garnished wages or repossessions, or are facing debts that you are unable to repay, putting off the inevitable can have devastating consequences. Procrastination can cost you your car, your wages, and even your home. Filing your case in a timely fashion can spare you these losses.
Filing a bankruptcy petition can be beneficial in a wide range of circumstances:
- If you are close to foreclosure on your home, declaring bankruptcy may stop this from going forward and even establish a payment structure that will help you pay off your arrears.
- Bankruptcy may allow you to take back an automobile that has been repossessed by a creditor.
- Large medical bills, especially when combined with a loss of employment can create a nearly impossible financial hole to climb out of. Bankruptcy can help reduce or even wipe away your medical bills.
- Bankruptcy can stop harassing creditors from turning up on your doorstep, especially if they are being unfairly pushy or unreasonable or fraudulently attempting to take more than you owe.
- If your utilities have been shut off, bankruptcy will help restore services so you do not have to live in darkness.
- Although your student loans will generally not disappear, bankruptcy may help you to reduce amounts owed so you can pay them off in a reasonable time frame.
- Bankruptcy can end wage garnishment, which means you will be able to afford life’s necessities.
If you are currently facing one or more of these issues, bankruptcy may be the best and most logical way to get a fresh start on your financial future. Contact FITZGERALD & CAMPBELL to assess how filing bankruptcy can impact your individual situation.