If you’re navigating through a time of intense financial hardship in Encino, CA, or Sherman Oaks, CA, you’re likely experiencing an incredibly stressful and overwhelming period that has implications for several aspects of your life.
Uncertainty, anxiety, and the reality of making significant decisions that will have repercussions well into your future are just some of the challenges you’re likely facing as you consider Chapter 7 bankruptcy. This doesn’t even get at the mounting debts, persistent creditor calls, or the stress of meeting daily expenses that underlie it all in the here and now.
Burton Law Offices is deeply committed to helping individuals find their way through such challenging times. With us, you can know that you are not alone in this journey. We understand the struggles that come with financial hardship and are here to offer support and guidance as you consider the option of filing for Chapter 7 bankruptcy. Our Chapter 7 bankruptcy attorney services are designed to provide you with the clarity, assistance, and advocacy you need to make informed decisions and regain financial stability.
More Information
What Is Chapter 7 Bankruptcy?
Chapter 7 bankruptcy is a legal process that allows individuals and businesses to eliminate most of their unsecured debts by liquidating their assets. This type of bankruptcy is also known as “straight bankruptcy” or “liquidation bankruptcy.”
The process starts by filing a petition with the bankruptcy court. Once the petition is filed, an automatic stay is put in place, which stops creditors from collecting on debts or taking any legal action against the debtor. The debtor must also provide a list of all their assets, liabilities, income, and expenses.
A trustee is appointed by the court to oversee the liquidation process. The trustee’s role is to sell the debtor’s non-exempt assets and use the proceeds to pay off as much of the outstanding debt as possible.
Once the trustee has completed the liquidation process, any remaining unsecured debts are typically discharged. This means that the debtor is no longer legally obligated to pay those debts, and creditors cannot take any legal action to collect them.
It is important to note that not all debts are dischargeable in a Chapter 7 bankruptcy. For example, child support, alimony, student loans, and certain taxes cannot be discharged through this process. Additionally, payroll taxes and trust fund taxes are not discharged.
Chapter 7 bankruptcy can provide you or your business the relief you need when struggling with overwhelming debt. However, it is important to fully understand the process and potential consequences before moving forward and filing for it. For example, filing for Chapter 7 bankruptcy may have a significant impact on your credit score and financial future. Consulting with a qualified Chapter 7 bankruptcy attorney can help you determine if Chapter 7 bankruptcy is the right choice for your financial situation.
What Is The Income Limit For Chapter 7 In California?
The income limit for Chapter 7 bankruptcy in California is determined by the means test. This test compares the debtor’s average monthly income for the six months prior to filing for bankruptcy to the median income for their household size in California. California Bankruptcy Court has used its means test since 2005.
If the debtor’s income is less than or equal to the median income for their household size, they are eligible to file for Chapter 7 bankruptcy. However, if their income is above the median, they may still qualify based on their disposable income after subtracting certain allowed expenses.
As of 2023, the median income for a single-person household in California is $60,986. For a two-person household, it is $81,373. The median income increases for larger households.
It is important to note that the means test is just one factor considered in determining Chapter 7 eligibility. Other factors, such as the amount of debt and the type of debt, are also considered. Additionally, the means test can be complex, and it is recommended that individuals consult with a qualified bankruptcy attorney to determine their eligibility and navigate the bankruptcy process.
What May Happen To My Assets In A Chapter 7 Bankruptcy?
Once you file Chapter 7 bankruptcy, the following 90 days (on average) from the filing date to the discharge of debt will have significant implications for your assets. In California, Chapter 7 bankruptcy exemptions are typically those that are considered necessary for daily living, including:
- $600,000 in equity in the home in which you reside or intend to reside within;
- Some equity in one car;
- Personal belongings;
- And more…
A poorly-planned Chapter 7 bankruptcy can result in significant losses. This is in part because trustees who are appointed in these Chapter 7 cases do not represent the debtor. Things you could potentially lose in a Chapter 7 Bankruptcy include:
- A house with too much equity;
- A second home;
- Money;
- And more…
Many people think, “I can handle my bankruptcy by myself.” They read some instructions on a website and file their case. But, when they go to court, they are in for a rude awakening and realize that they should have reached out to a lawyer all along.
You may be able to salvage your bankruptcy at this point, but doing so will, in essence, require that you seek out a bankruptcy lawyer consultation for Chapter 7. Only an experienced bankruptcy attorney will know the steps you could take and the exemptions that you could claim. Knowledgeable Chapter 7 bankruptcy lawyer assistance is your best bet to getting the ideal outcome.
Get Started Today
Burton Law Offices is here to guide you through the Chapter 7 bankruptcy process. Our experienced Chapter 7 bankruptcy attorneys offer the clarity, support, and advocacy you need to make informed decisions along the way. Don’t navigate this challenging time alone—reach out to us today and take the first step towards regaining your financial stability. Email or call us at (818) 514-1355 now for a consultation, and let us help you reclaim control of your financial future.
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