Chapter 7 Bankruptcy
Filing for bankruptcy under Chapter 7 may be a good option to consider for California residents who wish to eliminate debt that they are unable to pay back. It can be particularly helpful if you are overwhelmed by credit card debt, in the midst of wage garnishment or levy, or simply are suffering from creditor harassment. Once you receive a discharge under Chapter 7, the only debts that you may have left are any debts that remain after you sign a Reaffirmation Agreement or in some cases student loans and taxes*. One of the main advantages of this process, therefore, is that it generally provides you with a fresh start. Bankruptcy lawyer Sanaz Sarah Bereliani can provide individuals in the Los Angeles region with a free initial consult to determine if pursing financial relief under Chapter 7 is the best option for you in getting your financial life back in order. With the Bereliani Law Firm, you can rest assured that we will work to protect your rights at every step of the way.The Process of Filing Under Chapter 7
When you file for bankruptcy under Chapter 7, you receive an automatic stay that offers protection against the collection attempts and communication from any and all debt collectors and wage garnishments while your case is being processed by the Court for discharge. This process is relatively efficient compared to other forms of bankruptcy, often lasting just four to six months. Typically there is no minimum amount of debt required to file, and the fees associated with filing are relatively low in comparison to other options available to you.
While your bankruptcy is pending, you are essentially giving control over your property and debts to the bankruptcy court. The court employs bankruptcy trustees who step into your shoes to administer your “estate” which consists of your assets and debts. If it is determined that you have assets that are your capable of being protected, the trustee may choose to liquidate these assets in order to repay your creditors. In some instance, this may involve selling your property in order to pay the creditors or allowing you to keep your assets and pay the Trustee the value of the unprotected asset. As a result, while your Chapter 7 bankruptcy is pending, you may not give away, sell, or otherwise transfer any property that was in your possession at the time you filed for bankruptcy. You may, however, do anything you wish with income that you earn after the time of filing, or property acquired after the filing date. It is pertinent to your ability to protect the maximum amount of assets and preventing unnecessary issues that you hire a knowledgeable and experienced attorney that can advise you of red flags in your case prior to your filing. Bereliani Law Firm will advise you as to the issues you would be facing and things that should be considered in order to prevent unnecessary liquidation and ultimately a smooth filing.
Approximately a month after filing your Chapter 7 bankruptcy, the court holds a Creditors Meeting, which is conducted by the bankruptcy trustee assigned to your case. During this meeting, the trustee will meet with you, check your driver’s license and social security cards, and ask you questions under oath about the information you provided in your paperwork, under penalty of perjury. It is pertinent to your case that you provide Sanaz Sarah Bereliani all information about your assets, debts and income so that she can advise you properly prior to your case filing so as to prevent issues with the trustee or your creditors.What Can You Protect?
In a Chapter 7 proceeding, you have the option of choosing between two sets of exemptions, each providing you the opportunity to protect certain assets at a pre-set value. For example, the 704 exemptions are typically used to protect the maximum amount of equity allowed in your homestead - which applies to the home, apartment, condominium, motor home, or boat that you are using as your primary residence. However, if your assets consist mainly of personal property instead of real property, then the 703 exemptions would be better for you as they allow more protection for such things as bank accounts, tax refunds, investment accounts, future income, and cars.
After applying your exemptions, the trustee can choose to sell or liquidate your partially exempted assets or non-exempted assets in order to repay your creditors. As a result, figuring out which set of exemptions is right for you is a key decision in your bankruptcy process, not something that should be over looked. The Bereliani Law Firm is here to help guide you through the process of finding an appropriate strategy for you and your assets.Secured vs. Unsecured Debt
One of the main distinctions in bankruptcy is between secured and non-secured debt. Non-secured debt consists of items that are not backed by collateral, such as credit card bills, medical bills, personal loans, and overdraft fees on bank accounts. In most cases, these debts are automatically dischargeable.
Secured debts typically include home mortgages and other purchase agreements that are backed by collateral – such as a car. Filing under Chapter 7 provides you with the option of keeping some of your secured debts, like a car or home, if it is your intention to keep the collateral and continue making regular payments. In some cases, the secured creditor may require you to sign a Reaffirmation Agreement in order to continue keeping the collateral. Reaffirmation Agreements typically state that although you have filed for bankruptcy, it is your intention to keep the collateral and continue making regular payments and that if you default under the agreement that you provide the creditor with the opportunity to repossess the collateral and also come after you for a deficiency balance, just as if this debt was not included in the bankruptcy.Enlist a Knowledgeable Lawyer in Los Angeles When Reorganizing Your Finances
Deciding whether Chapter 7 may be right for you can be a difficult choice. Bankruptcy attorney Sanaz Sarah Bereliani has represented individuals from throughout Los Angeles and elsewhere in Southern California, including but not limited to Encino, Studio City, Culver City, and Woodland Hills. We have substantial experience when it comes to dealing with creditor abuse, debt settlement, and alternatives to bankruptcy. Reorganizing your finances today is the first step toward building a positive future that your future self will thank you for. For a free initial consultation with the Bereliani Law Firm, call 1-818-920-8352 or complete our contact form. We also represent individuals in Riverside, Lancaster, Santa Barbara, and communities throughout Orange County.
** Not all tax debt is dischargeable and in most cases student loans are not dischargeable. Please disclose all debts you have at your initial consultation so Sanaz Sarah Bereliani can advise you properly as to your rights and capabilities in discharging these debts.