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Bankruptcy
The main reasons for filing personal bankruptcy
are unforeseen medical expenses, excessive credit
card debt, loss of employment, and divorce. If you
are determined to file bankruptcy, it is generally
recommended to consult with a bankruptcy attorney
with experience in the field, since bankruptcy is an important decision and the
law and its application to your particular situation
can be very complicated. The attorneys of PHEIL LAW
FIRM will
help with completing the bankruptcy forms,
which could be very confusing to proceed on your
own.
There are two main chapters under which individuals
can file personal bankruptcy – Chapter 7 and
Chapter 13. Chapter 7 bankruptcy is actually a
liquidation of assets, when all non-exempt property
of the debtor is sold and the money raised is
distributed among creditors. However, there are
property exemptions, which are property the debtor
is allowed to keep. Property exemptions include some
real estate, personal things, tools of trade,
clothes, food, etc. It is very often that chapter
7 bankruptcy turns out to be a non-asset case,
which means there is no property to distribute and
all property is exempt, that is, the debtor can keep
it.
Once a bankruptcy petition is filed, the automatic
stay comes into effect. That means that creditors
can no longer undertake any actions, including wage
garnishments, foreclosures, repossessions, phone
calls and the like, against the debtor to collect
the debts they are owned. The stay last until the
bankruptcy case is closed.
Once the distribution of the assets is complete, the
debtor gets a fresh start by receiving a discharge
of most of his debts. However, there are certain
debts that cannot be discharged. Such debts refer to
alimony and child support payments, federal and
state taxes, fines, student loans and some other.
Chapter 13 bankruptcy is often called an
adjustment plan. It provides an opportunity for a
debtor to make up a payment plan. To qualify for
Chapter 13 bankruptcy, the debtor is required to
have a stable source of income to make payments
under the plan. Chapter 13 allows the debtor to
retain all his property as long as the adjustment
plan payments are made.
Just like in Chapter 7, upon filing a
petition, the debtor is protected from any colleting
efforts of creditors by the automatic stay, which
remains in effect until the case is closed. And the
case is closed when all payments provided for
adjustment plan are made is full.
Once the plan is accomplished, the debtor obtains a
discharge of the debts incurred before filing the
bankruptcy petition. Again, not all debts can be
abolished under Chapter 13 bankruptcy. The
non-discharged debts are the same as in Chapter 7.
Pheil Law Firm can handle your bankruptcy filing and
help you start fresh and keep a handle on your life.
Call us TODAY for assistance in Los Angeles,
Orange County, Riverside, San Bernardino, San Diego,
Santa Barbara and the Ventura County areas.
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