Bankruptcy chapter 7 vs 13 -Bankruptcy chapter 7 and chapter 13 lawyers near me

With the cooling of the economy, more and more individuals are processing their bankruptcy protections. There are a couple of different options for consumers. It depends on your particular circumstances the option will be better in your case.

Find bankruptcy chapter 7 and chapter 13 lawyers near me

The Chapter 13 Bankruptcy; A Payment Plan

Chapter 7 is used more frequently by individuals without assets or with few assets. If the consumer owns a house, a car with late payments or other goods of significance that he does not want to lose, filing for Chapter 13 bankruptcy is probably the most appropriate. It is also an alternative for individuals who are not eligible for Chapter 7 bankruptcy because they did not pass the media test.

Chapter 13 bankruptcy differs from that of Chapter 7 in that it depends on a payment plan, which lasts three to five years. The debtor’s payments to the creditors are consolidated and the debtor creates a monthly payment plan for the trustee that distributes the money among creditors.

Chapter 13 will also allow you to retain your home or car by correcting arrears while discharging all your debt.

Bankruptcy protection can be a lifesaver for individuals who are struggling to pay off mountains of debt. While Congress has regulated changes in bankruptcy law in recent years, bankruptcy protections remain a viable option for most people.

If your debts have grown to the point of drowning your financial situation, it is recommended to consult an experienced chapter 7 or chapter 13 bankruptcy lawyer from who can explain the process in detail and help you determine which option is the most convenient in your case.

Chapter 7 bankruptcy; a new immediate start

Chapter 7 bankruptcy is considered a “new beginning,” since it allows most debts to be discharged – that is, all of your debts are completely eliminated within a relatively short period of time. It is also known as “liquidation” bankruptcy since the assets of any consumer that are not exempt or protected by law can be taken by a bankruptcy trustee (the individual who manages bankruptcy) and used to pay a percentage of other consumer debts.

There are some restrictions. The consumer must complete and pass a means test in order to opt for Chapter 7 bankruptcy. Generally, this means that the consumer must fall within certain rules within a particular income segment in order to be eligible. To file for this type of bankruptcy.

Suitability for Chapter 7 in California

For bankruptcies filed after November 2010 in California, the median income limit for an individual is $ 47,234, for a family of four it is $ 77,596. In addition to the income requirements, the means test calculates other factors for the suitability of the consumer, such as transportation, food, health and clothing expenses. To be fit, one should consult someone not only familiar with the means test but also be well versed in handling some nuances that could mean that one is fit even if they have income above the median income limits.

The Chapter 7 Bankruptcy Process

The Chapter 7 Bankruptcy Process

Starting a Chapter 7 requires several steps. The consumer must pay a filing fee to the Bankruptcy Court Cashier, file certain documents and bankruptcy will begin. Once the bankruptcy process has begun, a “suspension of terms” takes effect. In essence, this means that all harassment by creditors and collections against the consumer must cease. However, lenders with liens on insured properties, such as a car, can file a motion for the relief of the suspension of terms if you are late with your payments. If authorized, this allows the creditor to recover your vehicle.