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.