If you are drowning in debt and need a lifeline, our experienced Los Angeles bankruptcy attorney Maureen Okwuosa can help. Our attorney will guide you through your options, explain how bankruptcy works and the different types of bankruptcy filings, and represent your best interests every step of the way. To learn more about Los Angeles bankruptcy rules and whether filing for bankruptcy may be a good option for you, call Okwuosa Pulliam Law Group today.
What Is Bankruptcy?
Bankruptcy is a legal, court-facilitated process wherein a debtor repays some or all of their debts or/and seeks relief from some or all of their debts. Because it is a highly regulated process, there are many rules and requirements associated with filing for bankruptcy. What’s more, the outcome of a bankruptcy case is legally binding. You may be required to repay some or all of your debts as ordered by the bankruptcy court; creditors are also obligated to forgive debts as ordered by a bankruptcy court.
Types of Personal Bankruptcy
If you are thinking about filing for bankruptcy, most likely you are choosing between the two most common types of bankruptcy for individuals: Chapter 7 bankruptcy and Chapter 13 bankruptcy.
Chapter 7 bankruptcy, also called liquidation bankruptcy, is designed for debts who have limited assets and have limited income and must be able to pass the Means Test. The Means Test is a way to determine whether the debtor has enough income to pay back a portion of their debts and should therefore enter into a repayment plan (via a Chapter 13 bankruptcy filing). If your household income is below the state’s income guidelines, you will pass the means test, but keep in mind that every case is unique.
In a Chapter 7 bankruptcy, your non-exempt assets will be liquidated, and the proceeds will be used to pay back your creditors to the extent possible. A Chapter 7 bankruptcy filing will remain on your credit report for up to 10 years.
If you have the income to do so, filing for a Chapter 13 bankruptcy has some advantages over a Chapter 7 bankruptcy. Chapter 13 bankruptcy is also referred to as the wage-earner’s plan. With Chapter 13, you will enter into a repayment plan with your creditors that lasts for 3-5 years. At the conclusion of the repayment plan, your remaining debts are forgiven.
The big advantage of a Chapter 13 filing is that you typically get to keep more of your personal assets, including a home, than you might not be able to keep in a Chapter 7 filing. In addition, a Chapter 13 bankruptcy can allow you to address issues that cannot be wiped away by a Chapter 7 case, such as support arrears, tax arrears or arrears on a mortgage or a car. A Chapter 13 bankruptcy will stay on your credit report for seven years.
Do I Need to File for Bankruptcy?
If you are unsure about whether bankruptcy is right for you, it’s important to talk to a professional. Filing for bankruptcy is a huge decision that can have a big impact on your life.
Why Work with Okwuosa Pulliam Law Group?
Bankruptcy can be an overwhelming legal process. Okwuosa Pulliam Law Group will help by explaining the bankruptcy types, determining your eligibility for bankruptcy, managing your bankruptcy filing, representing you at the bankruptcy hearing, and more. Our experienced bankruptcy attorney can streamline the process and improve its outcome.
Schedule Your Free Bankruptcy Consultation Today
To arrange your initial consultation call us at 310-935-9635