Los Angeles Bankruptcy Information
If you are having financial difficulty and thinking about filing for bankruptcy in the Los Angeles area, you may need to hire a bankruptcy attorney. There are two main types of bankruptcy that are usually filed, Chapter 7, and Chapter 13. In Chapter 7 bankruptcy, the person filing is basically saying they cannot, and do not foresee being able to repay the debts acquired. In Chapter 13 bankruptcy, the person filing is claiming they can repay the debts at a later date, and will create an organized payment plan for doing so.
There is not a law against filing for bankruptcy yourself, but most people probably would not even know where to start. A lawyer specializing in bankruptcy is an excellent resource when looking for information about the process, and will also be able to take much of the burden of filing off the individual. For example, a bankruptcy lawyer can:
- help determine if bankruptcy is the right option for you, and whether you should file Chapter 7 or Chapter 13.
- explain the federal and California state bankruptcy laws.
- manage the process and meet important deadlines.
- file the necessary documents, and if needed, represent the filer in court.
- ensure the case is indeed legally sound to avoid fraud (intentional or unintentional)
In Chapter 7 bankruptcy, you are, in short, filing a petition asking the court to wipe out (discharge) your debts. In exchange for this “clean slate” you will give up all property that is not considered “exempt.” If you are behind on payments for a car or mortgage, Chapter 7 will not protect you from losing those properties to the lien holders. There are Federal exemptions for Chapter 7, and when a married couple files together, these amounts will be doubled.
A list of Federal Exemptions:
- $ 18,450 in equity in your home;
- $ 2,950 in equity in your car;
- $ 475 per item in any household goods up to a total of $ 9,850;
- $ 1,850 in things you need for your job (tools, books, etc.);
- $ 975 in any property, plus part of the unused exemption in your home;
- our right to receive certain benefits such as social security, unemployment compensation, veteran's benefits, public assistance, and pensions--regardless of the amount.
The values are determined by what the property is worth now, not what you paid for it. This will include all property values; cars, furniture, and your house. If you own a home worth $50,000, and there is a $40,000 mortgage, then the exemption would be counted against the $10,000, which would be the equity if you sold the house.
In the case of Chapter 13 bankruptcy, you would be allowed to keep all your property if your repayment plan meets the requirements of the bankruptcy law. In most cases, your mortgages or car payments would remain the same and include some extra payments to catch up on the amount you are behind.
To determine which type of bankruptcy would best suit your needs, consult a bankruptcy lawyer in the Los Angeles Lawyers 360 Directory today.