Chapter 7 Bankruptcy

We understand that filing Bankruptcy is a big decision.  Generally Chapter 7 bankruptcy is the most common type of bankruptcy.

But how do you know if filing bankruptcy is the best option for you?  And what chapter bankruptcy should you file?  Also, do you qualify for Chapter 7 Bankruptcy?  Continue reading to learn about chapter 7 and why you need experienced Chapter 7 Bankruptcy Attorney San Diego.

Bankruptcy Basics: How does Bankruptcy work?

The Bankruptcy laws are not meant to punish you.  On the contrary, Chapter 7 Bankruptcy is meant to give you a second chance.  By and large, Chapter 7 Bankruptcy cases are filed more than any other bankruptcy chapter.  Chapter 7 Bankruptcy is commonly referred to as a "fresh start".  In fact, you never again have to pay the debts included in your bankruptcy case.  At the same time, you keep your assets.  Importantly, creditors included in bankruptcy are legally forbidden from collecting money from you.

• Cannot afford to pay more than minimum payments on credit cards.
• Without a job to pay your bills.
• Involved in a lawsuit because of unpaid debts.
• Taking money from one credit card to pay on another.
• Credit card payments are as much as or more than your housing expense.
• Struggling with personal loan payments.
• Owe large tax debt.
• Ordered to pay large child support payments reducing your monthly income.
• Late on mortgage payments.
• Falling behind with car payments.
• Involved in a divorce requiring you pay all or part of the marital debts.
• Have bad credit that is not getting better.
• Making credit card payments but never able to pay down the balances.
• Paying a large portion of your income toward your credit card payments.
• Liquidating retirement accounts to pay debt.
• Being hounded for payments by creditors.
• Unable to pursue additional education because you can’t get ahead on your credit card payments.
• Relying on your tax refund to pay down your debt.

What debt is wiped out in bankruptcy? 

Debts that go away in Chapter 7 Bankruptcy include:  credit cards, medical bills, personal loans, income taxes (that are at least three years old, were assessed more than two years ago and meet the 240-day assessment rule), attorney's fees, judgments, auto repossessions, foreclosure deficiencies, past due utilities, lawsuits and more.

To sum up, your balance owed on the above unsecured debts goes away.  You do not have to pay back these creditors.  Under the United States Bankruptcy Code, this is referred to as “discharge” of debt.

You can keep most, if not all your property in a Chapter 7 Bankruptcy, including:

• Equity in your primary residence up to approximately $600,000.
• Cars.
• Household goods: furniture, clothing, electronics, sports equipment, etc.
• Retirement accounts: 401k, Pension, 403b, IRAs and other IRS qualified accounts.
• Jewelry.
• Term life insurance policies.
• Whole Life Insurance policies with a limited cash value.
• Money in the bank.
• Tax refunds.
• And MORE!

Qualifying for Chapter 7 Bankruptcy

Before filing bankruptcy, you need to speak with a Bankruptcy Lawyer San Diego.  The bankruptcy laws are complex requiring an in-depth analysis of your household income and your assets including real and personal property.

The Bankruptcy Means Test

At the Law Offices of Mark L. Miller, the first step is to confirm that you pass the bankruptcy "means test".  Passing the means test is required under the United States Bankruptcy Code.  If your income is below the median income for your household size the means test does not apply.  However, if you are above median income then the means test calculation must be performed.  Keep in mind that you may pass the means test even if your income is "above median."  You need an experienced bankruptcy attorney to analyze your pay and confirm if you can qualify for chapter 7.

Protecting Your Property

Next, we will analyze your assets and make sure none of your property is at risk if you file bankruptcy.  As discussed in detail below, exemptions are used to protect property from creditor reach.   Exemptions are liberal for California residents but understanding them is tricky.

File Chapter 7 Once Every 8 Years

Also, keep in mind that you can only file chapter 7 once every 8 years.  If you filed another chapter 7 case within the past 8 years you are not yet eligible to file.  That said you can consider filing chapter 13 if you need immediate bankruptcy protection.

Documentation and Credit Counseling

In addition, both the United States Bankruptcy Code and the San Diego Bankruptcy Rules require certain documentation in every bankruptcy case.  Another step in the pre-filing process is completing a credit counseling class through an approved credit counseling agency.

Protect Your Property with Bankruptcy Exemptions

As has been noted, property is protected in bankruptcy using exemptions.  Above all, choosing the correct set of exemptions is the most important aspect of a bankruptcy filing.  Exemptions are complicated and require application of either Federal or State laws.  In particular, California exemptions are especially generous compared to other states.  Still, they require careful analysis and application in a Bankruptcy filing.

Another key point is that the Bankruptcy Laws allow you to keep your San Diego residence.  Even if you have as much as $600,000 in equity in your primary residence!

However, protecting property when filing bankruptcy is complicated.  Without a skilled bankruptcy attorney who knows and understands how to apply exemptions, you risk losing some or all your property in a bankruptcy case.  Therefore, you need a qualified Chapter 7 Bankruptcy Attorney San Diego. The attorneys at the Law Offices of Mark L. Miller have been handling bankruptcy cases for over 25 years. Contact us today to schedule your free consultation.

Filing bankruptcy prevents the following creditor conduct:

• Stop creditor calls
• Wage garnishments
• Bank levies
• Auto repossessions
• Foreclosure
• Tax levies
• Tax liens
• Property seizure
• And MORE!

Indeed, filing Chapter 7 bankruptcy initiates an “automatic stay” under the United States Bankruptcy Code.  The “automatic stay” acts as a stop sign preventing creditors from continuing collecting. For example, court ordered collections such as wage garnishments and bank levies stop.  Upon filing a bankruptcy case, foreclosure sales must be cancelled.  Furthermore, a creditor cannot repossess a car, truck, motorcycle, RV, boat or any other motor vehicle.

Nevertheless, there are procedures that must be followed to ensure the creditors are notified of a bankruptcy filing. For this reason, it is particularly important to consult with Chapter 7 Bankruptcy Attorney San Diego with sufficient expertise.  Text (619) 574-0551 for a free consultation.

What Debts does Chapter 7 Bankruptcy Clear?

Filing bankruptcy gives you a fresh start by eliminating debt while allowing you to keep most of your property. In fact, most clients keep all their property and lose nothing but their debt! To begin with, Bankruptcy law is not meant to punish you. To this end, the law allows for property exemptions to keep your car, house, jewelry, clothing, and everything else. Unsecured debts like credit card balances, personal loans, money judgments, and certain taxes can be wiped out in Chapter 7.

What Debts Do Not Go Away in a Chapter 7 Bankruptcy?

Some debts will not be wiped out in a Chapter 7 bankruptcy.  For example, spousal support, alimony, child support, student loans, court fines, government fees, parking citations, speeding tickets, restitution, criminal claims and taxes owed for the past three years.

How Long Does Filing Chapter 7 Bankruptcy Take?

Generally, Chapter 7 Bankruptcy cases last about four months. First, we will file your Chapter 7 Bankruptcy petition with the United States Bankruptcy Court. Then you will attend a 341a meeting of creditors.  The Bankruptcy Court schedules your 341a meeting of creditors.  The 341a meeting of creditors is held about 30 days after your bankruptcy case is filed.

On this occasion, you will be accompanied by an experienced Chapter 7 Bankruptcy attorney from the Law Offices of Mark L. Miller.  Our attorneys are extremely qualified; they have attended thousands of 341a meetings.

Afterward, you will wait approximately three months for your discharge order to be entered by the Bankruptcy Court.  Finally, your bankruptcy case is done and you are debt free!

Choose our Chapter 7 Bankruptcy Attorney San Diego

While bankruptcy law is extremely powerful, it is equally complex. Navigating through the bankruptcy process can be overwhelming.  Therefore, it is most important that you speak with a skilled chapter 7 bankruptcy attorney.  Our process is different from many other bankruptcy firms.

We are Different from Other Bankruptcy Attorneys

For example, our knowledgeable bankruptcy attorneys meet with every single client.  First, you will meet with one of our attorneys for your free initial consultation.  That means you get the knowledge, experience, compassion and perspective from an attorney, not a sales person.  Keep in mind that we offer appointments in person, by phone, or through video at your convenience.

Second, the attorney will give you an in-depth analysis of your situation.  Third, we will explain the procedures, alternatives and risks associated with filing bankruptcy.  This means we will discuss several different options for getting out of debt.  Lastly, we will answer all your questions.  Most importantly, we do not have high pressure sales tactics.

Above all, our priority is for you to feel comfortable with your decision to file bankruptcy.  For this reason, the Law Offices of Mark L. Miller is here to guide you from beginning to end of your bankruptcy case. Get out of debt and get back to living life.  Contact us at the Law Offices of Mark L. Miller in San Diego. Talk with one of our experienced Chapter 7 Bankruptcy Attorneys so you know your rights and can get out of debt.