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Chapter 7 Bankruptcy

Carrying Debt

“Interest is like a snake bite.  Just as the poison is not noticed at first but soon overwhelms the person, so too interest is barely noticeable until it accumulates to an overwhelming sum.” Rashi’s Commentary on Exodus 22:24 (Parsha Mishpatim), 11th Century


"Bankruptcy doesn't choose you, you choose it." NFL Hall of Fame Defensive Tackle Warren Sapp, Chapter 7 BK Case #12-17819, Filed 3-30-2012, Discharged 9/24/2012


PRICING: Individual Chapter 7 Petitions without a means test and fee waiver application only $750

Joint Chapter 7 Petitions without a means test and fee waiver only $999

Individual Chapter 7 Petitions with a means test and fee waiver application only $999

Joint Chapter 7 Petitions with a means test and fee waiver only $1095

You may find lower pricing in parts of San Diego but definitely not with the quality of service, commitment to details, and experienced   attorney work we offer.  Don't pay a little less for a paralegal to complete your petition without understanding the complexities and                          subtleties of bankruptcy law that we do.

 

I.  Introduction - Where to Start?

"A Chapter 7 Bankruptcy case begins with the consumer filing a petition with the Bankruptcy Court serving the area where the individual lives or where the business debtor is organized..."  UScourts.gov Bankruptcy Basics Guide.  This is commonly known as "declaring bankruptcy" and officially starts the Bankruptcy process.

 

 

II.  How do I know if I should DECLARE bankruptcy?  Why Should I File Bankruptcy?


The primary purpose for chapter 7 bankruptcy is to legally discharge certain debts to give an honest individual consumer a “fresh start.” The consumer receives a "fresh start" by having no liability for the discharged debts. UScourts.gov Bankruptcy Guide.

 

This means that you do not owe your creditors the money anymore and your account balances are legally zeroed out which will be reflected on your credit report. However, you can still pay your discharged creditors back if you want to do so.

 

Another benefit is that in many cases you will receive an automatic stay from any pending collection actions, lawsuits, unlawful detainers, or foreclosures against you.  The collection calls stop too.

 

III.  Sounds Good. Why Not File Bankruptcy?

Filing bankruptcy may potentially damage your credit score and will show on your credit report for approximately ten (10) years. Beware of advertisements promising an improved credit score immediately after bankruptcy. It usually takes one year or more for your credit to bounce back but it will so long as you are responsible.  While it is possible in some cases to see instant improvement, this is not usually the case and is just a marketing ploy.  Unlike our competition, we offer post-bankruptcy credit repair and advising services standard in all of our Chapter 7 Bankruptcy cases at no additional fee.

 

Some types of debts are not discharge-able in bankruptcy so if your debts primarily fall into those categories then it may not benefit you to file bankruptcy and you should consult an attorney to see if an exception applies in your case.  See 11 USC 523 and see table below.

 

In general, the following table represents the types of debts which may or may not be dischargeable under the United States Bankruptcy Code.

May be Dischargeable

May NOT be Dischargeable*

  • Credit cards
  • Loans
  • Medical Bills
  • Pending Civil Court Actions & Judgments
  • Collection Accounts
  • Personal Guarantees
  • Debts from foreclosure (recourse & non-recourse loans)
  • Debts from repossession of property
  • Wage garnishments
  • Judgments
  • Back taxes
  • Any debts owed to governmental institutions
  • Student Loans
  • Judgments against the debtor noting fraud
  • Judgments for personal injury or death where the debtor was intoxicated or under the influence of drugs
  • Judgments against the debtor for intentional acts (not negligence)
  • Child Support
  • Debts assumed from Marriage Settlement Agreements and/or by order of family court
  • Debts incurred in bad faith where the debtor never intended to repay them.  So-called "Shopping sprees"

*There are exceptions to the general rule of non-discharge-ability, consult an attorney.  The above table is not intended as legal advice, please do not rely on it.

 

In addition, a Chapter 7 bankruptcy discharge does not extinguish a lien on property. UScourts.gov Bankruptcy Guide, so if you are interested in stripping an unsecured lien on a second mortgage from your home then please see our information regarding Chapter 13 Bankruptcy.

 

Lastly, many consumers do not want to file bankruptcy for fear of the stigma and will try everything and anything to buy time before being forced to file for bankruptcy protection for one reason or another.  Don't wait until you have wages garnished, judgments entered, bank accounts levied, and have been subjected to debtor's exams from aggressive creditors.  It makes more sense to start sooner, get out of debt sooner, and get the bankruptcy off your record before these things happen.

 

drowning in debt

 

There is no need to drown in debt, stay awake nights, and make yourself sick while struggling to pay creditors that you can't afford because you're afraid of bankruptcy.  If you're over extended financially and need relief then get real help.  Don't get scammed by debt consolidation companies, credit counselors, and empty promises.  There is no limit to the crazy avenues people will follow to get out of debt without just filing bankruptcy to really get out of debt. Legally discharge your debts through bankruptcy and get a fresh start today.

 

 

 

IV.  How do I Know if I Qualify for a Chapter 7 Bankruptcy?

If you can benefit from discharging your eligible debts, the automatic stay, and getting out from under the cycle of debt discussed above then you may qualify for Chapter 7 bankruptcy if your GROSS income (your income before taxes) is below the median level for the area you live in given the number of people living in your household.  The rule of thumb for determining household size is the number of "heads on beds."  The United States Census Bureau publishes and periodically updates the information on the Department of Justice website based on the statistics for your region.

 

In California (for cases filed after 11/1/2011) the numbers are reflected in the table below.*  Note that these numbers are subject to change, please check the link to the Department of Justice – Census Bureau Median Family Income By Family Size for the most up to date information and do not rely on the table below.

State

1 Earner

2 Person Family

3 Person Family

4 Person Family*

California

$47683
$61539 $66050

$74806

*Add $7,500 for each individual in excess of 4

 

If your income is below the level for your household size then you automatically qualify for Chapter 7 Bankruptcy and our lowest attorney's fees for your household size apply (see above).

 

V.  What if my Income is Above the Median for my Family Size?

If your family’s gross income exceeds the median amount then you may still be eligible for a Chapter 7 discharge, rather than a Chapter 13 repayment plan, after completing what’s known as the means test.


The means test is found on Bankruptcy Form 22A, you can complete it for free on your own here.  However, we would strongly advise against completing this on your own as the form involves complex calculations and legal terminology you may not be familiar with.  If you have questions about completing the test or want to make sure that you are claiming all of your eligible deductions then we can complete a comprehensive means test for you at a reduced fee (1 - 2 hrs of attorney time @ $250/hr) and will roll the fee into the total cost of the bankruptcy if we can qualify you.

 

If you do not qualify for a Chapter 7 discharge after the means test, then you may still file one under the presumption of abuse which may be appropriate under certain circumstances.  The consumer may want to consider filing a Chapter 13 bankruptcy as an alternative.

 

To that end, if you do not initially qualify for a Chapter 7 and are not interested in a Chapter 13 repayment plan, then you may be able to qualify for a Chapter 7 in the future if your current circumstances change.

 

Call us regarding your pre-petition planning needs (619) 794 0460.  This is one of the most important services we provide.  We routinely assist honest debtors arrange their financial affairs in order to legally qualify for a Chapter 7 Bankruptcy in the future.  These services are similar to how a tax professional helps their client's minimize tax liability.

 

VI.  What Happens to My Stuff?


A common misconception in bankruptcy is that the debtor will have to surrender personal assets to the trustee.  In the vast majority of cases all of the debtor's limited assets are protected.  There are homestead and personal property exemptions which allow debtors to protect hundred's of thousands, and potentially millions of dollars in assets from the bankruptcy estate.  You will more than likely be able to keep your car, furniture, retirement accounts, jewelry, firearms, cash savings, etc.  The key inquiries are determining which exemption series to file under and how to maximize the available exemptions.  Call us for your free initial consult (619) 794 0460.

 

 

VII.  I'm Qualified and Want to File.  Now What?

 

Upon retaining our office, paying the fee, and submitting your documents we will have your petition ready to file within two (2) weeks guaranteed (or sooner if needed). We do bare bones same day emergency filings for people facing foreclosure.

 

Within one (1) month of filing you'll have what's known as your 341(a) hearing where the trustee will swear you in and ask you some questions under oath.  The foregoing is a representation of what to expect at your 341(a) hearing assuming that your attorney performed their due diligence, there are no irregularities or concealed assets in the consumer's bankruptcy, and the consumer submitted all of their documents on time.  Getting you to a 341(a) hearing like this is our goal and we have a less than 1% continuance rate.  Please see our positive google reviews from other satisfied bankruptcy clients.

 

 

Assuming everything goes well and none of your creditors object then you'll receive your discharge within 3 months of the date of filing and 2 months after the date of the above hearing. We are oversimplifying the process here to a degree and you will have to provide us with a great deal of information and documents to ensure everything goes this smoothly, but so long as you do this in advance of the deadlines that we will provide you with up front, then your bankruptcy court experience may go just like demonstrated above.

Give us a chance to help you:  This e-mail address is being protected from spambots. You need JavaScript enabled to view it , 619 794 0460

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