Learn About Bankruptcy Law and What Not to Do Before Filing for Bankruptcy

If you are considering this option, understanding bankruptcy law is important. There are specific criteria that you must meet in order to qualify for a Chapter 7, and a judge will have to approve your plan for a Chapter 13.  This means that they will be looking at your financial situation now and in the near past. Businesses applying for bankruptcy are under even further scrutiny.  With that in mind, it is important to exercise caution with your financial decisions so that it doesn’t appear as if you are trying to trick the system.

Here is what you should know:

• Illegal transfers.  If you transfer property out of your name to a friend or family member, it may be an illegal transfer.  First, consider if the asset has any equity or real value.  If it does and you transfer it within one year of filing for bankruptcy, the court could consider it preferential and require the asset to be transferred back so that it can be properly distributed amongst your unsecured creditors. 
• Payments within 90 days.  During the 90 days prior to filing for bankruptcy, you are not allowed to make any preferential payments. This would be paying one creditor over another.  If, for example, you paid money towards a loan your parents gave you this could be considered preferential.  As a result, they may be required to give the money back.  This can pose a far greater difficulty for the person that you paid, especially if it is an individual.  By understanding bankruptcy law, you can avoid making any illegal preferential payments and the complications that can follow. 
• Fraudulent transfers.  If you transfer any assets with an attempt to defraud creditors, you may have consequences within your bankruptcy case and be exposed to the possibility of criminal charges.  

We can review your financial decisions and any transfers that you have made within the last 90 days to a year and let you know if they could put your bankruptcy at risk or if the court may seek to have the funds returned.  In some cases, people need to delay their bankruptcy filing until 90 days from a particular transfer.  We can discuss this with you in further detail during a consultation. 

It is also important to note that while you are waiting to file or in the process, you must still make certain debt payments. Some people make the mistake of thinking that if they are filing for bankruptcy they don’t have to pay any debts.  The truth lies somewhere in the middle.  If your debt is secured by something that you want to keep (house, car, etc.) then you must continue to make the payments because bankruptcy does not prevent them from exercising their right to foreclose.  That means that the bank could foreclose on your home, causing you to lose it even if you file for bankruptcy.  With this in mind, continue paying your secured debts and stop paying unsecured credit cards, medical bills, lines of credit, etc.  During your consultation, we can review each of your debts to provide specific payment advice in accordance with bankruptcy law.

When Looking for Bankruptcy Legal Services, Be Sure to Work with a Lawyer

At The Travis Law Firm, we offer bankruptcy legal services to individuals and families throughout California.  We understand that this is a major decision both financially and personally.  This makes it important to work with a trusted advisor.  In the state of California, and elsewhere, there have been issues with companies offering bankruptcy help that did not follow through or file the paperwork correctly. As an individual, it is difficult, if not impossible, to know if someone you hire will do what they say and that is why you should work with an attorney.  Attorneys have a fiduciary duty to their clients, meaning that we are held to a higher standard and responsible for giving sound advice and doing things in accordance with the law and our clients’ interest.

An example of these issues arose when California homeowners were trying to protect their homestead interest.  The state of California allows for anywhere from $75,000 to $175,000 of equity in a home to be protected as part of the bankruptcy process.  That means that when filing bankruptcy, if you owe $75,000 in unsecured debt and have $75,000 in equity in your home, you would not be required to sell your home to pay off the debt.  This is an important law that has helped families throughout the country to remain in their home while getting out from under their debts. 

Unfortunately, companies throughout California were offering bankruptcy legal services by saying that they would handle the paperwork and document filing for the homestead provision to apply then not doing it.  In order to have your home protected using this law, you have to file paperwork in the county where you live.  These companies were not lawyers but were still offering these services.  When many of them failed to do what they said, homeowners were not granted their homestead protections, and some lost their home as a result.  The state legislature responded by regulating these companies so that other families would not suffer the same fate. You can read the regulations by searching for CAL. BPC. CODE 17537.5.  

While this was a good step taken by the legislature, it simply serves to demonstrate the importance of working with a law firm when undergoing something as significant as a bankruptcy filing.  When you file bankruptcy, there is a set process that must be followed in order to ensure that it is done correctly.  There is a variety of forms and deadlines that must be met.

Additionally, if you are trying to protect your home or other assets like your car, steps must be taken to do so.  You can’t simply request it but need to go through the process, and this is where non-lawyers struggle.  The legal system is not designed to be simplistic or easily manageable.  While that would be nice, it’s simply not the case because every time a new piece of legislation is passed, the laws become that much greater.  As an attorney, it is our job, duty, and responsibility to understand the law, follow it and adhere to all procedural guidelines.  As such, if you are looking for bankruptcy legal services, call our law firm so that you can trust it will be handled correctly. 

How a Chapter 7 Attorney Can Help You With the Homestead Act

If you are considering working with a Chapter 7 attorney and filing bankruptcy, you need to consider all of your options and ensure that your family is protected.  This is an excellent way to get a clean slate and start fresh without a mountain of debt.  For families that are simply in over their head, this can be the best way to move forward and get ahead of your bills instead of always feeling that you are behind while struggling to catch up.  This type of bankruptcy provides the option of wiping away your debts instead of making payments.

Since you can wipe away your debts, all of your assets are also on the chopping block.  If you have a lot of equity in your home (s), cars, boats, etc. they can all be claimed and sold as a way to give your creditors some money.  This is especially true on any assets that are collateralized.  For example, if you own a boat with a loan on it, the boat is probably collateral for that loan and the bank has the right to reposes it.  There are, however, ways that you can protect yourself and your family.

The homestead laws have been established to help people that are going through a difficult time financially. They are designed to ensure that people do not end up homeless.  The laws vary from state to state but in California anywhere from $75,000 to $175,000 can be claimed as part of the homestead provisions.  Everyone qualifies for the lower amount of $75,000 with higher amounts allowed incrementally based on income and age. In order to qualify for $175,000, you have to be 65 or older or disabled.  What these laws allow people to do is to claim that dollar amount of equity is protected from creditors in a Chapter 7 or other legal action. As a Chapter 7 attorney, we can ensure that the form is filed correctly. 

When the bankruptcy judge looks at the assets that you have that can be sold to pay debts, they cannot include equity that is covered by the Homestead Act.  In many cases, this prevents a home from being sold because the equity above the protected amount is insignificant and wouldn’t be able to satisfy the outstanding debt.  In order to qualify for this protection, you must complete a homestead declaration and file it in the county where you live.  If it is not filed correctly, your home may not be safe.  As a Chapter 7 attorney, we can help with this process to ensure that you and your family are protected and able to stay in the family home.

As a lawyer, we can also help to protect some of your other assets.  For example, we can make a case that you need to keep a car so that you can drive to and from work every day, important for ensure that your financial problems to do not escalate even further.  During your consultation, we will review your assets and debts than create a strategy for each one.  To file your Chapter 7, give us a call today. 

Learn Which Debts Can Be Included in a Chapter 13 Bankruptcy Filing and What is Exempt

Working with a Chapter 13 Attorney in a Chapter 13 bankruptcy, you can get a fresh start by creating a way to get out from under your debts.This type of bankruptcy does not wipe out your debts but creates a way for them to be repaid over time.  In most cases, only a portion of the total debt is paid, and once the payments have all been received, the remaining debt is discharged or wiped out.  This provides a way for creditors to receive some form of payment without you going under from trying to keep up with debt obligations.  In essence, it is a compromise. 

Most of your debts can be included in a bankruptcy filing.  There are, however, a few debts that you cannot include and will have to continue making payments on.  These include:

• Home mortgage.  If you are planning on remaining in your home, you will need to keep making the loan payments as agreed.  If this is difficult to do, ask your lender to consider a loan modification.  They may offer you the option of paying a lesser amount for a set period of time before reverting to your original payment.  In other cases, you may be able to reduce the interest rate and lower your monthly payment by refinancing. 
• Child support.  Parents that are obligated to pay child support as part of a court order will need to continue making that payment as agreed.  This also applies to alimony. Both a Chapter 13 bankruptcy and a Chapter 7 bankruptcy, will not eliminate these debts. If you need a reduction, you will have to seek one through family court in the state that ordered it initially. 
• Student loans.  If you have student loans or other government guaranteed debt, you will need to continue making these payments and cannot get rid of them through filing a bankruptcy. 
• Taxes.  It may go without saying that tax obligations cannot be eliminated through bankruptcy.  The IRS, however, may be willing to reduce the amount that you owe directly.  There is an application process that you need to go through in order for them to consider this. 

While these debts cannot be included in your bankruptcy filing as you work with a Chapter 13 Attorney, they are included in the calculations of what you can afford to pay towards debt on a monthly basis.  The way that a Chapter 13 works is you list out your income after paying taxes and all of your monthly expenses.  This includes paying for housing, utility bills, cell phones, groceries, gas, insurance, etc.  You can also include the payments that you have to make to debts such as child support and student loans.  After deducting everything that you have to pay, the amount that is left can be allocated towards debt payments.  In this way, while you cannot discharge all of your debts you still get credit for them in determining what you can pay towards your other ones as you work with a Chapter 13 Attorney.

To learn more about the process and how a Chapter 13 bankruptcy works, call and schedule an appointment. 

Seniors: Speak With a Bankruptcy Attorney Before Giving Up!

Senior citizens often need a bankruptcy attorney in order to protect their freedom and independence.  It is common for seniors to run into financial difficulty.  Careful planning is often not enough to prevent financial troubles because life has a way of throwing curve balls.  For example, monthly retirement payments may be lower than expected, stocks that you received dividends from may no longer be paying out, and medical bills may have caught you by surprise.  These are only a few examples of the many unknowns that when they happen, can leave seniors in a financial jam. If this sounds like you – you’re not alone. 

We work with a lot of seniors that are worried that they will have to give up their home in order to take care of debts and stop the collector calls.  After living in your home for decades and working hard to pay down the mortgage, you shouldn’t have to walk away while in your retirement years.  Don’t give up hope because we can help.

In a Chapter 13 bankruptcy, you can have a payment plan that will prevent your creditors from pursuing further collection, and you can stay in your family home.  In this scenario, we can help you to create a plan after reviewing how much money you have come in every month and what your true expenses are.  This is different than when you file for a loan.  Instead of only looking at your debt payments, we want to know what you spend on groceries, gas, medication, doctors, etc.  In order to capture a true picture of your financial situation, we need to know every detail. As a bankruptcy attorney, we will then work to create a plan for settlement and repayment.

When you file a Chapter 13, you are proposing to repay some of your debts but not all of your debt.  Once we determine how much money you have to apply towards debt payments every month (after living expenses and bills) we will propose to make a set payment amount on a monthly basis.  It will be disbursed amongst your various creditors for a period of a few years.  Any debt that remains will be discharged or eliminated.  For example, if right now you should make $950 in monthly debt payments and owe a total of $45,000, we could propose that you only pay $300 a month for three years which equals $10,800.  

The court will decide whether or not the plan for repayment is acceptable. Your creditors will also have the opportunity to protest, but most of the time they are happy to get something instead of not getting paid at all.  As a bankruptcy lawyer, it is our job to demonstrate why you should be able to file for a Chapter 13 and why the repayment plan is the best you can do.  Once it goes through, your creditors cannot come after you for any more money and you will be able to live comfortably in your home.   

If You Have a Good Salary You Can Still Get Help From a Bankruptcy Lawyer

Many of our clients ask if they can work with a bankruptcy lawyer if they earn a lot of money.  The answer is yes.  We have helped many high-income earning clients to file for bankruptcy in order to resolve their debt situation. The type of bankruptcy that you can file is dependent upon several factors including how much money you make.  If you think that you earn too much, it is that much more important to work with an attorney.

While you may earn a good living, you may not be considered a “high-income debtor” in the eyes of the court.  Whether or not you are is dependent on several factors.  The court will first look at where you live.  This is important so that families living in D.C. are not compared with those living in Ohio, as the cost of living and how much people make are different throughout the country.  Next, they will consider your family size.  As your family grows it becomes more expensive to feed, clothe and care for them.  This is understood within the bankruptcy court and it helps a lot of people to qualify for a Chapter 7 that otherwise wouldn’t.

In order to be a “high-income debtor” you must earn above the median income for your family size in your state.  In California, if you make $77,896 and have a family of four you are at the median income level.  For every member of your family, the amount that you can earn is increased.  This changes every year so speak with a bankruptcy lawyer to get the updated figures.  As long as you are at the median income level or below it, you can qualify for a Chapter 7 where all or most of your debts are eliminated.  If you are above it, the next step is to take a means test. 

A means test gives you the opportunity to provide more information about your income and your debts in an attempt to show why you should be allowed to file a Chapter 7.  As a bankruptcy lawyer, we can also make the case for why you should be allowed to do so.  If you are active duty military or National Guard, you are generally exempt from taking the test so let us know during your consultation if you are a service member.  It may help you to file a Chapter 7.

If you do make too much money, you can still file bankruptcy but you have to file a Chapter 13 instead.  A Chapter 13 can still eliminate some of your debts, but it does so by creating a settlement and payment plan.  This way your creditors still get some money back, but the amount is reduced enough to be affordable.  In this situation we can help you to create a proposed repayment plan that demonstrates what your true disposable income is after all of your expenses (including groceries and gas) in order to determine what you can apply monthly towards debts.  

As a bankruptcy lawyer, we can help you to navigate through the process so call today for your consultation. 

If You Need Bankruptcy Help Here are the Guidelines You Need to Meet Under BAPCPA

We offer bankruptcy help to families throughout California.  It is common for clients to ask us if they will qualify given that the bankruptcy laws changed a few years ago.  In 2005, the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) was passed at the federal level and now anyone that wants to file needs to meet those guidelines in order to do so.  There are multiple components to this legislation.   It aims to protect consumers by educating them and better prepare them to manage their finances, take discretion away from judges, and protect creditors by making sure people aren’t constantly filing for bankruptcy.  We have found that most of our clients still qualify under the new guidelines.  

Here is what you need to know:

Time Delays: If you have filed bankruptcy in the past, there are rules for how long you need to wait before you can file again.  This can range from two years to eight years, depending on the type of bankruptcy filing you did before.  We can review your case and let you know if you have waited long enough. 

Credit Counseling: Before you are allowed to file for bankruptcy you now need to take a mandatory credit counseling class.  This can be done online 24/7 or over the phone and only costs around $50.  It takes an hour, so this isn’t much of an inconvenience.  If you can’t afford a class, they have to let you take it for free. If you have more questions about the course, call us for bankruptcy help. 

Means Test: Before, a judge had the discretion to determine if you should qualify for bankruptcy based on your income and expenses.  Now, there is an eight-page document that needs to be filled out that uses the income you earned over the past six months and includes mandatory deductions.  It also has a provision for qualifying under the median household income guidelines.  In Riverside, CA the average household income is $57,096 according to the U.S. Census Bureau.  This means that most families in the area would qualify since a couple with four children only needs to make less than $80,910.  This has made it easier for most families to qualify and for those that make more than the median income; they can still qualify by using the standard deductions. 

Debt Management: If your bankruptcy gets approved, you have to participate in a debt management course. This course teaches how to manage finances and debt payments so that going forward you are less likely to need to file bankruptcy again.  We have found that people, who seek bankruptcy help, generally like this course because it provides tools they can use later on and most of our clients want to use this as a fresh start that doesn’t have to be repeated.

We understand that the bankruptcy laws can be confusing and will help you to successfully navigate through them.  For more information or a consultation, give us a call. 

A Bankruptcy Lawyer Can Help to Protect Your 401k

If you need to eliminate debt, a bankruptcy lawyer can help you to do so while preserving some of your assets.  There are various assets that are protected under bankruptcy laws, as long as a judge approves your filing.  For example, your primary residence can be protected so long as your equity doesn’t exceed the threshold.  You may also be entitled to keep your vehicle.  In both scenarios, you would be responsible for making the monthly payments if you are allowed to keep the property.  In other words you can’t keep an asset and eliminate the debt on it at the same time.

Simultaneously, your 401k and other retirement funds are typically protected assets.  Even if your 401k has enough money in it to pay off your credit card debt, you may be able to wipe away the debt while keeping your retirement account intact.  This is a huge benefit for people that don’t want filing for bankruptcy to negatively impact their financial future as they age. 

In order to make sure that your 401k is protected, you should get legal advice from a bankruptcy lawyer.  While in general your retirement funds are safe, every case is different so you will need specific legal advice.  One important thing to keep in mind is that the funds need to stay within your account in order to be protected.  If you transfer money out of your 401k into your checking account, those funds become fair game because they could be used for daily expenses.  It is extremely important to keep this in mind and leave the funds alone before, during, and after your bankruptcy filing.

The same holds true for any property that you purchased using your retirement funds.  If, for example, you withdrew retirement funds to purchase a second home, it would be up for grabs as the funds used to purchase it would not be protected.  If you are even considering filing for bankruptcy, do not touch your retirement funds.

If you have a different type of retirement account, it may be protected as well as long as it qualifies under the Employee Retirement Income Security Act (ERISA) since the Supreme Court has ruled that funds can't be transferred to pay creditors. IRAs that are non-ERISA accounts are protected under federal law up to $1,245,475.  This is a considerable amount of money and makes it easier for people to file bankruptcy that have a significant amount of funds in their retirement accounts. 

As a bankruptcy lawyer, we understand how the laws can be complicated and it is our job to help you navigate through them successfully.  By understanding the laws and working within them, you can keep many of your assets while eliminating your debt.  This can put you on the path for a successful financial future and we will help you to make this happen by providing excellent legal representation.  To learn more and to find out if you would qualify for bankruptcy, give us a call.

Bankruptcy Lawyer Explains Exemptions in California

When filing for bankruptcy you need to work with a bankruptcy lawyer that is an expert at understanding the laws, exemptions, and nuances associated with these types of proceedings. Bankruptcy can be the solution you are looking for in order to get out from under a mountain of debt and to live your life freely once again.  Getting constant debt collection calls is no fun and can even be extremely stressful.  For many people, this is a reason enough to declare bankruptcy and a skilled attorney can help.

It is important to understand that although bankruptcy sounds simple, there are many laws that come into play when going this route.  For example, just because you are allowed to declare bankruptcy doesn’t mean that a judge has to approve it or that they have to approve your specific plan.  There is no guarantee that they will, making it important to work with an expert. 

Once you have filed for bankruptcy, there are certain exemptions that you should be aware of.  An exemption is something that can be excluded from your assets while filing.  A California bankruptcy lawyer can provide you with more specifics but in the meantime here is what you need to know. 

• Your Home.  Your primary residence can include a physical stick built house, mobile home, RV, boat or wherever you happen to live.  According to the law you can have $75,000 in equity in your home and that equity can be exempt from liquidation in the bankruptcy.  If you are married, both spouses can claim the full exemption for a total exemption of $150,000.  The rules can change based on certain groups of people for example retirees or the disabled.  If you claim an exemption and the total equity in your home is at that amount or less, the trustee will not sell your home, and you can keep it while continuing to make the payments on it.  If your equity exceeds the exemption amount, they may force you to sell your home. 
• Personal Property.  Generally speaking, your furniture, appliances, clothing, food, and things necessary for living are exempted from the bankruptcy. Jewelry is only exempt up to $5,000 which cannot be doubled by the spouse like the home equity can. 
• Bank Deposits.  If you receive social security payments, $2,000 of your bank account balance can be exempt.
• Cars.   You can have up to $1,900 in equity in your car.  If it is over that amount, the vehicle may be liquidated by the trustee. Your bankruptcy lawyer can also argue the merits as to why you need to keep it.  This may include an argument for your need to get to work or pick up kids from school.  At times, you may be allowed to keep it but have to pay the amount over the allotted equity exemption. 

There are also rules for how much of your wages you are entitled to keep along with pension funds and retirement. Hiring a bankruptcy lawyer is important for ensuring that you can keep the maximum amount of your income, assets, and retirement funds.  To learn more call The Travis Law Firm today.

What You Should Know Before Hiring a Bankruptcy Attorney

If you are in over your head with debt, a bankruptcy attorney can help.  When financial circumstances become overwhelming, there are ways you can address them in order to get back on your feet.  While bankruptcy used to have negative associations, the down economy has led many people to consider it as an option.  One thing you should evaluate is the level of stress your current debt load and financial situation is creating in your household.  Is that stress worth continuing the struggle and dealing with non-stop debt collection calls?  Many people find a huge sense of relief when the calls and letters finally stop. 

Before you hire a lawyer, there are certain things you need to know.

Bankruptcy Law is a Specialty

Just because someone is a lawyer does not mean that they know how to handle bankruptcy cases.  Yes, they can research it but that time will be added to your bill.  Why spend more money than you have to when you can work with an expert that can complete the paperwork and proceedings with efficiency?  Working with an expert attorney will also give you the advantage of learning about certain areas of the law that others may be unaware of.

There Are Several Types of Bankruptcy

There is no one size fits all bankruptcy solution.  There are several chapters within the bankruptcy code that you can file yours under.  A skilled bankruptcy attorney will be able to discuss your current financial situation with you and make a recommendation for what is likely the best way to file.  For example, there are liquidation bankruptcies where assets are sold in order to pay creditors and bankruptcies that are designed to pay creditors back over time with a set payment plan.  The type that you file should be based on your current financial capabilities and your goals.  

You Can Typically Keep Your Home

Unless you have a staggering amount of equity in your home, you can typically maintain ownership of it even when filing bankruptcy.  If this is your goal, let your attorney know right away so that they can create a legal strategy in order to accomplish it.  Even if you are facing foreclosure a bankruptcy may be able to stop the proceedings and allow you to continue living there.  

Share the Details

When speaking with your bankruptcy attorney, be sure to provide any and every detail about your financial situation and your goals.  This way they can create a legal strategy that will be successful.  If the hearing officer or judge feels that you are untruthful about your financial situation they may not approve the bankruptcy in the first place.  Transparency matters in this situation. 

Ask About Fees

Any time you hire a lawyer you should ask what they will charge and how they will bill you.  It is important to enter a relationship with a mutual understanding.  This will also help you to budget for anything that you need to spend. 

If you are considering filing bankruptcy, The Travis Law Firm can help.  Schedule your consultation by calling (951) 274-9501.

Speak with a Bankruptcy Lawyer Before Filing for Bankruptcy

It is important to consult with a bankruptcy lawyer before you file.  This will help you understand your options fully and how they will impact you and your family both now and in the future.  Selecting the right type of filing is the first step to achieving your financial goals and getting out from under your debts.

One of the first things we will ask during your consultation is what your goals are.  Consider the financial goals you have for your family. This should include what you want your monthly budget to look like and what assets you want to keep or get rid of.  We also need to know how much money you are making on a monthly basis and what your current expenses are aside from your debts.  This will help us make an educated recommendation on how you should proceed.

As a bankruptcy lawyer, we can help with a Chapter 7 and Chapter 13 bankruptcy. There are major differences between the two and it is important to select the right one.

Chapter 13

A Chapter 13 filing is a good idea for people who want to keep the majority of their assets and pay back creditors over time.  Many people don’t like the idea of liquidating everything so they would rather continue to pay off their debt in a way that is manageable on a monthly basis.  We work with clients to create a monthly budget that is reasonable and affordable.  This budget needs to take into consideration how much money you make after paying taxes, child support, rent or a mortgage, utilities, groceries, gas and incidentals.  The remaining amount should be what you have available for making debt payments.  Every monthly expense has to be calculated otherwise you will not be able to keep up with the arranged payment plans.  If the trustee feels that your monthly budget is accurate they will look at your proposed settlement plan.  In this scenario, your creditors will take a reduced amount overall while still getting something in return.

Chapter 7

This is a liquidation bankruptcy where your assets are sold to pay off your debts. This may include all of your assets including your home.  However, as a bankruptcy lawyer we will request that certain assets like your home and car are exempt from liquidation.  The trustee is likely to approve this as long as there is not a lot of equity in the property.  If the equity in the property is enough to pay off a lot of your debts, it may need to be sold.  This is an ideal situation for people that cannot possibly make debt payments and want to be free from the stress quickly.  Once the bankruptcy is approved your creditors cannot come after you for additional payments.

To learn more about the various types of filings and what they can mean for your financial future, call the Travis Law Firm at (951) 274-9501.

A Bankruptcy Attorney Can Help to Stop a Foreclosure

If you are facing foreclosure, a bankruptcy attorney can help stop the process.  It is important to consult with a lawyer right away if you feel that the bank is about to start a foreclosure action.  Once they have filed a motion to foreclose with the court it is more difficult to stop the process.  The Travis Law Firm helps families throughout California to stay in their home while navigating through bankruptcy proceedings. 

There are two main types of bankruptcy, a Chapter 7 and Chapter 13.  Once you file with the court, an automatic stay is put in place so that your creditors cannot continue their collection action until the court has sorted things out. This is a huge benefit for families that want to find a way to stay in their home but are overwhelmed by the constant collection calls and being behind on their bills. 

Consulting a bankruptcy attorney is the first step in the process.  We can make recommendations on which type of bankruptcy you should file based on your current financial situation, needs and goals.  Filing correctly is essential for stopping foreclosure and time is of the essence so do not delay in contacting us. 

Chapter 7

A chapter 7 is the most commonly known bankruptcy because it liquidates your assets in order to wipe out your debts.  In this scenario, the court appointed trustee will review your documents to determine how much money your creditors would receive if your assets were sold off to pay them.  It is understood that they will not get what is owed to them but hopefully they get something.  If you have a lot of equity in your home, the trustee may require it to be sold.  Typically those facing foreclosure do not have a lot of equity so selling it would not help the situation.  When this is the case, you can request for it to be exempt from the proceedings.  The trustee will make their determination in part based on your ability to keep paying the mortgage.  If your other debts were wiped out could you pay your mortgage on time?  If so, you have a good chance of being able to keep your home.  

In this scenario, the lender will often take the amount that you owe in back payments and interest then attach it to the end of the loan.  This allows you to make payments on time going forward.  Once your bankruptcy is finalized you still have to make these future payments on time.  If you don’t there is nothing stopping the lender from foreclosing again. 

Chapter 13

This type of bankruptcy allows you to create a settlement plan and make payments to your lenders.  They typically have to agree to a reduced payoff amount and your bankruptcy attorney will make a proposed payment plan to the trustee.  This plan needs to be realistic, and the trustee needs to feel confident in your ability to make the payments over a period of time.  This usually lasts for three to five years.  If you want to keep your home, the payment should be included in your ongoing monthly payments. 

To learn more contact The Travis Law Firm by calling (951) 274-9501.

A Bankruptcy Law Firm Helps with Court Proceedings

Court procedures can be overwhelming, and a bankruptcy law firm can help you to navigate through the process.  The court system is based on process and procedures.  Unfortunately, it is extremely difficult for the average person to understand the nuances of what is required, the amount of paperwork that must be completed, and how it must be filed.  Once the process starts, understanding courtroom protocol and how to handle proceedings is also challenging.  Hiring an advocate that is experienced will help you to achieve the results that you are looking for.

Here are some of the proceedings you can expect if filing for bankruptcy.

·         Required credit counseling.  Every person that files is required to take a credit counseling class.  While informative, failure to complete it can get your case dismissed.

·         Hearings to lift the stay.  When you file, an automatic stay is put in place to prevent creditors from pursuing you and continuing collection action.  Creditors have the right to go before the court and ask for the stay to be lifted.

·         Meeting the trustee.  The court will appoint a trustee for your case.  This person will request and review documents from both you and your creditors.

·         Creditors meeting.  Your trustee will schedule a meeting with you and your creditors where they can both ask you questions about your financial affairs, debts, and bankruptcy papers.  This is done under oath, so it is important to obtain copies of all of your current, and recent historical, financial information. Copies should be given to the trustee ahead of time, and you should take a copy for yourself.

·         Adversary proceeding.  A creditor or the trustee can file suit against you while you have an active bankruptcy case.  The lawsuit will be assigned its own case number but remain within your bankruptcy.  As a bankruptcy law firm, we deal with adverse proceedings on a frequent basis and file them on behalf of clients as needed.

·         Proof of claim.  Each creditor that wants to be paid as part of the bankruptcy needs to file a proof of claim with the court.  Your attorney can approve or object to their claim.

·         Hearings.  The trustee and the court have the right to dismiss your case and will do so if they feel it is unmerited or the facts have been inaccurately represented. Simultaneously, they are also the ones to approve your bankruptcy case and repayment plan. 

A bankruptcy law firm will help you to file the initial paperwork correctly and to navigate through the process along the way.  There is no way to predict exactly how each one of your creditors will respond to your filing, making it important to be prepared for any eventuality.  Whether a creditor attempts to lift the stay or files an adversarial proceeding, a lawyer can help you to stay on track and get your bankruptcy case approved.  Instead of being overwhelmed by the process, you can sail through it with the help of your attorney. 

Bankruptcy Law and Foreclosures

If you are losing your home bankruptcy law may be able to save you from going through a foreclosure.  While each case is different, a Chapter 7 can delay a foreclosure for months while a Chapter 13 can enable you to stay in your home while making payments according to your repayment plan. 

Our attorneys are experts at helping families stay in their home while navigating through the bankruptcy process.  When your home is at stake, it is important to work with experienced representatives.  One simple paperwork mistake could cause the court to not approve your bankruptcy and your foreclosure to continue as scheduled.

Per bankruptcy law when you file for a Chapter 13 or a Chapter 7 the court will put an “automatic stay” in place.  This automatic stay informs creditors that they need to halt all collection activities pending the results of the court hearings.  At minimum, the stay normally lasts three to four months.  In order to have the stay lifted a creditor needs to go before the court a make a motion, something that your bankruptcy attorney can argue against.

In a Chapter 13 bankruptcy, you and your lawyer will propose a repayment plan.  In this plan, you will need to have enough money every month to cover your current mortgage payment along with whatever amount you direct towards back debt payments.  For example, if you are six months behind on your mortgage and owe $12,000 you could propose that the $12,000 is paid back over a period of five years.  The court has to approve your repayment plan and so long as they do; you will be able to stay in your home and pay your debts back over time.  This is an excellent option because it gives you the certainty of avoiding foreclosure and being able to stay in your home without worrying about harassing calls and letters from your lender.  The important thing to remember is that you must stay current on your mortgage loan and debt repayments going forward.

In a Chapter 7 bankruptcy, the automatic stay will continue while your bankruptcy is being processed.  This is a liquidation where the court will evaluate all of your assets and your debts to determine what can be sold to pay your creditors.  If you want to stay in your home, your lawyer can help to make your home a protected asset that is not liquidated.  Typically, the court will agree unless you have a large amount of equity in your home that could otherwise satisfy your debts.  At minimum, the foreclosure will be delayed as part of the process.

Life events like losing a job or incurring large medical bills can cause people to get behind, even on their home mortgage.  Fortunately these options can help families to stay in their homes longer. Bankruptcy law enables people to get back on their feet when they are swimming in debt.  Whether through a Chapter 7 liquidation or a Chapter 13 reorganization, families are able to create a plan that will help them to recover and build their financial stability again.  

A Bankruptcy Attorney Helps Clients File a Chapter 7

If you need to clear up debt, a bankruptcy attorney can help you to file a Chapter 7 bankruptcy where all or most of your debts are canceled. Working with an experienced lawyer will help to protect your rights as once you file, all of your financial affairs are in the hands of the court.  This includes your debts and your assets.

To start the process, you will need to fill out a variety of forms with your lawyer.  These documents will list out your personal information along with how much money you are currently making, your living expenses, property, debts, and any property that you want to have exempted from the filing.  This may include your primary residence if you want to continue living there and paying the mortgage.  You will also need to document your financial history for the past two years including if you purchased, sold, or gave away any property.  This is the courts way of understanding your case and ensuring that you aren’t trying to hide any additional property or assets.

Once the paperwork is filed, and the fees are paid, an automatic stay will be placed on your debts so that creditors cannot foreclosure or try to collect outside of the legal proceedings.  This is an excellent way for homeowners to avoid or postpone a foreclosure. It should also stop the harassing phone calls.  Your bankruptcy attorney will make sure of it.

The court will appoint a Bankruptcy Trustee to oversee the proceedings.  The trustee’s job is to make sure that your creditors receive as much money as possible through the liquidation of your assets.  They will review your paperwork to determine what, if any, non-exempt property is available for liquidation and if any recent financial transactions can be undone in order to free up additional cash.  Very often, there are no real assets to liquidate.  If there are, the trustee will order them to be sold and designate how the proceeds are to be distributed among creditors.

The trustee will also hold a creditors meeting where your creditors have the opportunity to speak, make a case, and request additional funds.  This is the time where you will be asked questions by the trustee and typically the only time you have to go to court.  It is important to have your bankruptcy attorney at this meeting in order to help you through the questioning process and challenge the creditors if necessary.

If you have secured debts, such as an auto loan, you will typically have to give the creditor the collateral the loan was secured with.  For example, you may need to return the vehicle.  If the property or asset is exempt then, you may be allowed to continue making the loan payments and keep the vehicle or home. If you don’t continue making the payments, the creditor can still come after you in the future.  As a bankruptcy attorney, we can explain the proceedings in detail during your initial consultation.  Call us today to schedule yours.

A Bankruptcy Lawyer Can Help You File a Chapter 13

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A Chapter 13 can provide debt relief, and a bankruptcy lawyer can help you through the process.  This is an excellent option for families seeking debt relief that also want to stay in their home.  With a Chapter 13 filing, people can stop foreclosure and make their delinquent payments over time. This allows families to stay in their home and start making mortgage payments on time again instead of being forced to make up the delinquency in one lump sum payment. 

In Chapter 13, a payment plan can be reached where, apart from your mortgage, one monthly payment is paid then distributed to your creditors according to the plan.  This lasts for a period of years, based on what you propose and what the judge approves.  Your creditors typically get paid a reduced amount than if you had the money to simply pay them off.  This makes it possible to get out of debt while still paying your creditors something.  Once the plan is approved, you are obligated to stick with it by making monthly payments on time.  Otherwise, your creditors can take you back to court. 

There are several rule and procedural issues that you need to know in order to get your Chapter 13 approved.  Hiring a skilled bankruptcy lawyer will help you through this process. For example, you must complete credit counseling within 180 days prior to obtaining your bankruptcy.  A copy of your course completion must be included with your initial filing in order for it to be processed. You must also file recent pay stubs or income documentation, a statement of your monthly net income and whether that is expected to go up or down, along with copies of tax returns.  At the time of the filing, a fee must also be paid to the court, typically $235 and $75 for processing. 

Your bankruptcy lawyer will also help you to fill out the forms and input the required information.  This includes:

1.    A list of who you owe money to and the type of loan that it is.  For example, a credit card with a balance of $35,000 owed to Bank of America.  Gather copies of your most recent statements to show your attorney so that the paperwork can be completed faster. 

2.    How much money you make, how you make it, and how often you are paid.

3.    A list of your assets and property. This would include your home, cars, boat, etc.

4.    All of your monthly living expenses.  This needs to be realistic, not conservative.  It should include everything that you pay in order to sustain including gas, food, and medication in addition to things like utility bills. 

Your income information will determine how much money you can use to pay towards debt payments on a monthly basis.  This is important because the judge needs to feel confident that you are acting in good faith and making the best effort to repay your debts.  Make sure that your income and expenses are represented accurately before filing your petition.  An experienced bankruptcy lawyer can help you to complete the forms and to get your bankruptcy approved.