After trying everything from cutting back on daily spending to picking up a side hustle after work hours, it is possible that your chances of clearing your debts still seem minimal. Though you should consider it as the last option, declaring bankruptcy in California can offer you the most realistic way of climbing out of burdensome debts and reclaiming your financial health.
Before making this life-changing decision, you should first carefully explore all available debt relief options. Filing for bankruptcy might be one of the most challenging decisions you will ever have to make concerning your financial life, but it is a crucial move towards finding debt relief for a new and fresh life without debt burdens.
Wherever you live in Dana Point, we at Los Angeles Bankruptcy Attorney would be proud to help you with the California bankruptcy filing process to obtain the debt relief you deserve for your financial recovery.
How Bankruptcy Court Operates and Bankruptcy's Main Goal
While most court cases occur in a criminal or civil court, a bankruptcy case has a dedicated court that you should file your petition. Ensure you check online the bankruptcy court with jurisdiction over your area using your location address.
According to the California bankruptcy code, you should file your petition in the bankruptcy court around the place where you have lived or resided in the past one hundred and eighty days.
Once you file a bankruptcy petition, the judge has the discretion of making a binding decision on whether you are eligible for a debt discharge or not. However, most aspects of bankruptcy declaration in California takes place outside of the bankruptcy court.
For instance, whether you are filing Chapter 7 or Chapter 13 bankruptcy, the court will appoint a trustee who carries out most administrative duties like reviewing your petition documents. During the bankruptcy declaration in California, your appearance in a bankruptcy court is unnecessary unless there are any objections or protest against your petition.
The only time your appearance in a bankruptcy court might be necessary is during the confirmation hearing of your repayment plan under chapter 13 or reorganization bankruptcy. You will also have to attend an informal meeting known as the 341 meeting or creditors meeting at the trustee's office.
The California bankruptcy code's primary purpose is to allow debtors (people and businesses) who are mainly in heavy debts to have a fresh start by keeping their creditors at bay for a while.
If your bankruptcy petition goes well, the court will discharge your debts, releasing you from personal liabilities for particular dischargeable debts. In other words, you will no longer have a legal obligation to repay any of the discharged debts. The success of your bankruptcy petition will also depend on whether you have an attorney or not.
To know if a bankruptcy declaration is a viable option for clearing your overwhelming debts during these challenging economic times, you should consult with a reputable Dana Point bankruptcy attorney.
Tips for Finding a Reliable Bankruptcy Attorney in Dana Point
You cannot undermine the need for an attorney when declaring bankruptcy because he/she will act as your legal advocate and guide you through what is often a confusing process among many petitioners. Below are tips to consider when finding a bankruptcy attorney in Dana Point:
Communication Skills and Compatibility
Typically, a reliable attorney must have good communication skills regardless of his/her practice because that is what their work entails. The quality of your communication with your attorney when declaring bankruptcy is essential. During your first consultation with your attorney, you should note any red flags that might affect your compatibility with him/her, for example, a language barrier.
When you notice the attorney is unfriendly, hesitating, or rushing to answer your questions, the chances are that the situation will not be changing even if you start working together. Ensure your prospective bankruptcy attorney is respectful and courteous from the manner he/she talks to you.
Seek Personal Referrals
Knowing a person who has had experience with a bankruptcy attorney is the first step to finding a reliable professional. Talk to your trustworthy colleagues, friends, and relatives and hear if they have an idea of any reputable bankruptcy attorney within your area of residence.
If you receive several recommendations, you can narrow down your choices according to your interest by scheduling consultations with a few of them to gauge their professionalism level.
Consider the Attorney's Expertise and Experience
Bankruptcy law is a broad field and has many different specialties, meaning not all attorneys out there will offer the services you need for your unique financial and debt situation. Look for an attorney who can address your unique financial problem and offer you the legal representation you need.
Further, it is wise to consider your attorney's work experience and success rate or record of his past bankruptcy cases. To successfully maneuver the California bankruptcy code requires in-depth knowledge and understanding of this area of practice. A misfiled or erroneous petition can make you ineligible for this form of debt relief.
Consider the Services Fee of Your Dana Point Bankruptcy Attorney
Finally, when deciding to hire an attorney, you must come down to the cost of his/her services. During your initial consultation with your prospective bankruptcy attorney, you should ask him/her about his/her services fee rate, what it includes and how to make the payment.
When searching for a reliable bankruptcy attorney, the attorney with the cheapest service fee rates is not always reliable because he/she could be an amateur in the industry. Most bankruptcy attorneys' services fee rates depend on their level of experience and your case's complexity.
Find a bankruptcy attorney with favorable services fee rates, considering your current financial situation and budget.
Do Your Homework
Use the internet wisely because it is the most convenient way to find useful information and reviews about bankruptcy attorneys around your location. When you look at your prospective bankruptcy attorney's website, you will find past clients' comments and complaints, which will give you an insight into the firm's quality of services.
When you take ample time and consider the above tips, you should find a dependable Dana Point bankruptcy attorney who can offer you legal help on this confusing process to obtain debt relief.
Forms of Bankruptcy in California that You Should Consider
California bankruptcy code provides individuals like you, facing challenging economic times with two common forms or chapters of bankruptcy, giving you a fresh start from crushing debts. These two bankruptcy chapters usually offer different advantages and protection to petitioners eligible to declare bankruptcy under California law.
As an individual seeking debt relief through bankruptcy, it is advisable to declare the following chapters or forms of California bankruptcy:
Chapter 7/Liquidation Bankruptcy
When you file this form of bankruptcy, you are giving the bankruptcy court the authority to seize and sell some of your properties, excluding the following types of properties:
- Particular personal properties, for example, furniture
To qualify for a debt discharge under chapter 7, the court will consider some factors like your income level and whether you can repay your debts. If you meet the eligibility requirement for declaring chapter 7, the court will appoint a trustee who will sell your "non-exempt" properties.
After liquidating your property or assets, the trustee will use the proceeds to settle your debt as much as possible. Then, after a few months following your petition, you will receive a notice of your debt discharge, which releases you from the legal obligation to settle the dischargeable debts.
Chapter 13/Reorganization Bankruptcy
When you file chapter 13/reorganization bankruptcy, you and the court must agree on a repayment plan that you will wipe off your debt over time, typically between 3-5 years. A reorganization bankruptcy is advantageous and favorable to employed individuals on a dependable income because it doesn't require you to give up any of your property/assets in exchange for a debt discharge.
When you file chapter 13, you must stick to your specific court-mandated repayment plan because it can lead to dismissal of your case, allowing creditors to continue harassing you. Not every employed individual with a dependable income is eligible for this form of bankruptcy, but a reliable attorney can guide you through this confusing process.
For peace of mind when filing bankruptcy, you should contact an experienced and reputable Dana Point bankruptcy attorney to discuss your financial status and the bankruptcy options available.
California Bankruptcy's Automatic Stay
When you file either liquidation or reorganization bankruptcy, a court order that is known as "automatic stay" will become effective immediately, stopping your creditors' debt collection efforts against you. California bankruptcy's automatic stay will prevent your creditors or debt collection agencies from:
- Harassing you through phone calls and text messages
- Starting or continuing any pending lawsuit against you
- Taking money from your income (wage garnishment)
As part of the bankruptcy declaration requirement, you will include a list of all of your creditors in the petition so that the court clerk or trustee can notify them of your bankruptcy case. Bankruptcy's automatic stay will not only offer protection to you, but it will also protect your loan co-signers or co-debtors.
Non-Dischargeable Debts Under California Bankruptcy Law
There are particular types of debts that will not disappear when you file bankruptcy. If you owe the following types of non-dischargeable debts, bankruptcy declaration will not solve your financial dilemma:
Recent Student Loans
If you have recent student loans that are more than five years due, the bankruptcy court might not grant you a discharge from this debt. The bankruptcy court can only grant an exception to this rule if repaying the debt would produce "undue hardship" to you, which is very rare.
Typically, state, federal, and local taxes are non-dischargeable for at least three years following your tax return filing. However, property taxes are dischargeable in a bankruptcy declaration if they are over a year late, but any lien against your property is not.
Child Support and Alimony
Unless there is a special agreement approved by the court, filing bankruptcy will not solve this financial dilemma. Ensure you consult a Dana Point bankruptcy attorney if you owe these kinds of debt to know how you can eliminate them.
Any fine that you owe following a court judgment as restitution or penalty is non-dischargeable through bankruptcy. For instance, fines from a DUI or personal injury case where the court lures you guilty of the charge.
Any Other Debt that You Didn’t List on Your Bankruptcy Petition
The reason why you need a Dana Point bankruptcy attorney is to ensure that your petition is complete and contains every information essential to the form or chapter of bankruptcy you are declaring. When you mistakenly omit any dischargeable debt on your petition, the bankruptcy court will not consider it when discharging your debt.
Rebuilding Your Credit After Filing Bankruptcy
The idea that filing bankruptcy will remain in your credit record forever delays many people from pursuing this kind of debt relief, which is helpful during challenging economic times. Although filing bankruptcy can harm your credit record, the harm is not permanent.
Bankruptcy declaration makes it challenging to receive loans of low-interest rates because lenders or creditors consider you risky. Therefore, rebuilding your credit score after a bankruptcy declaration is paramount.
By obtaining a new credit card and using it wisely, you can convince lenders that you are now able to manage your money and are determined to rebuild your flawed credit record. The bottom line is that if you use your credit and income wisely, you can stand on your two financial feet again sooner than you think.
A reliable bankruptcy attorney will give you handy tips for rebuilding your credit score after declaring bankruptcy for a fresh financial start.
Find Dana Point Bankruptcy Attorney Near Me
To have a reliable expert assess your current financial situation and provide options for solving your financial dilemma, please contact Los Angeles Bankruptcy Attorney at 424-285-5525 wherever you are in Dana Point. Our attorneys have lengthy experience in this field and will advise you on the best form of bankruptcy to solve your debt issues.