Considering filing for bankruptcy can be overwhelming, especially if you don’t understand the most important terms. Regardless of why you might be going the bankruptcy route, you should be familiar with the process which includes knowing the terms and not being fooled by bankruptcy myths. Also, most importantly, you should hire San Diego, CA’s leading debt attorney, and you’ll be back on your feet in no time. Let’s begin with a rundown of the most common terms.
What terms should I be familiar with concerning bankruptcy?
You don’t need to learn the entire history of bankruptcy to be able to understand what’s happening. Start with the basics, such as the following terms:
Once you as the debtor file a bankruptcy petition, automatic stay is imposed. It’s an injunction that will stop collection activity, including garnishments, foreclosures, and lawsuits. You should be aware that depending on the type of bankruptcy, you may not be fully protected from creditors. For example, if you file for Chapter 7 bankruptcy, automatic stay won’t put a stop to child support collection.
To open a bankruptcy case, you need to file a bankruptcy petition. If the debtor files it, it’s a voluntary case, while an involuntary case is when the creditor files the petition.
A discharge releases a debtor from personal liability for specific debts that are considered dischargeable. So, creditors won’t be able to take any action against you, collect those debts, or harass you in some way.
This is the property that you can keep from creditors following the Bankruptcy Code. The type and amount of exempt property vary depending on the state you reside in. For example, with the homestead exemption, you can keep a part or all of the equity in your primary residence.
Fraudulent transfer refers to the debtor transferring their assets in order to defraud and hide them from creditors. Transferring some of your assets and getting less than the assets’ value is also considered a fraudulent transfer.
A means test is used to calculate the debtor’s income and expenses to determine whether they can pay off their debts without filing for bankruptcy. If the means test shows an abuse of the Bankruptcy Code, conversion or dismissal of the case may be required. If you can justify any additional expenses or adjustments to your income, you may be able to rebut the presumption of abuse.
Proof of claim
This is a written statement the creditor files. It describes the reason why you as the debtor owe the creditor money.
Bankruptcy schedules are detailed lists describing the debtor’s financial information, such as their assets and liabilities. Schedules are filed by the debtor with the bankruptcy petition or quickly after.
As per section 314 of the Bankruptcy Code, creditors; meeting is required. The creditors, an examiner, or a trustee should question the debtor about their financial situation.
Where in San Diego, CA, can you find an experienced debt attorney?
Hiring a reliable and knowledgeable lawyer who specializes in debt and bankruptcy matters is crucial if you want to get the most benefits and avoid stress. You need a professional who will answer all your questions, guide you through the whole process, and help you get a fresh start as soon as possible.
At Bankruptcy Law Offices of Mark L. Miller are at your disposal! Our highly qualified and experienced attorneys will help you every step of the way. Let us handle your case so that you can have a relaxing stroll at Balboa Park not worrying about your debts. Get in touch with us and set up your free consultation!