Folsom Bankruptcy Attorney
If you are struggling to pay your bills, a Folsom bankruptcy attorney can help you regain control of your finances. Bankruptcy isn’t shameful. It’s a powerful, legal tool that helps hardworking people erase their debts and rebuild their financial welfare. However, filing for bankruptcy is a serious task that requires attention to detail and extensive planning. Before you start the bankruptcy process, make sure you fully understand your options and their implications.
California Bankruptcy 101
The Great Recession deeply impacted Folsom and Sacramento. While the economy is starting to rebound, many families are still struggling with excessive debt. Bankruptcy helps you either erase or restructure your debt. While the bankruptcy process varies depending on your circumstances, there are some common elements in all bankruptcies.
Bankruptcy Puts a Stop to Harassing Collections Activities
When you file for bankruptcy, the court issues an automatic stay that stops debt collection. This automatic stay covers all of your debt — even those that cannot be discharged in a bankruptcy, such as student loans. For the entire duration of your bankruptcy, your creditors cannot call you, send letters, or proceed with a lawsuit against you.
Most, But Not All, Debt Is Discharged in a Bankruptcy
A bankruptcy discharges (or erases) most of your personal debt. Dischargeable debts include:
- Contract and lease payments,
- Credit card debt,
- Medical bills,
- Most lawsuit judgments,
- Personal loans, and
- Promissory notes.
However, some debt is nondischargeable. For example, you cannot erase:
- Alimony and child support,
- Criminal fines, penalties, and court-ordered restitution,
- Most student loan debt, and
- Most tax debt.
A Folsom bankruptcy attorney, will carefully review your debts as well as help you identify all possible dischargeable debts.
A Trustee Will Oversee Your Bankruptcy
The Bankruptcy Court in Sacramento will appoint a trustee to oversee your case. The trustee does not represent you or your creditors. Instead, he or she represents the bankruptcy estate (consisting of your property and assets). While his or her exact duties will vary, they typically involve:
- Identifying your property,
- Reviewing creditor claims,
- Assessing your eligibility for discharge, and
- Distributing payments to creditors.
Unlike a trustee, a Folsom bankruptcy lawyer is on your side. At the Law Office of Diane Anderson, we will help you understand your rights, legal options, and help you negotiate a fair bankruptcy with your trustee and creditors.
Types of Bankruptcy
Federal law offers a variety of options for personal and business-related bankruptcy. Before you file for bankruptcy, you must carefully assess your options. A Folsom bankruptcy attorney can help you decide which form of bankruptcy best serves your needs and goals.
Chapter 7 Bankruptcy
Most California bankruptcies are filed under Chapter 7. Sometimes called a liquidation bankruptcy, your non-exempt assets are sold to pay your debts. Any remaining, dischargeable debts are erased at the end of your bankruptcy. If you do not have any non-exempt assets, your debt is simply discharged. You must meet a means test to qualify for Chapter 7 bankruptcy. Since this means test involves a complicated series of calculations, most people rely on a Folsom bankruptcy attorney to assess their eligibility.
Chapter 13 Bankruptcy
In a Chapter 13 bankruptcy, you do not sell your assets and property. Instead, you enter a five-year payment plan with your creditors. While Chapter 13 has significant benefits, it typically takes longer than a Chapter 11 bankruptcy, ties up your disposable income, and requires significant financial discipline. At the Law Office of Diane Anderson, we will help you decide whether Chapter 13 is best for you.
Bankruptcy for Businesses and Family Farms
If you are the owner of a struggling business or family farm, you might be eligible for a Chapter 11 or Chapter 12 bankruptcy. Reorganizing a business or family farm through bankruptcy is a complex process. If you are interested in Chapter 11 or Chapter 12 bankruptcy, contact our office for more information.
Alternative Debt Solutions
Bankruptcy is not for everyone. A Folsom bankruptcy attorney will help you assess other legal options, such as:
- Debt consolidation,
- Credit counseling, and
- Negotiating a repayment plan.
Contact us for more information about these options today.
Life After a Folsom Bankruptcy
Once your bankruptcy is complete, your dischargeable debt is erased. However, you will still face some challenges post-bankruptcy. For example:
- A bankruptcy will remain on your credit report for up to ten years.
- You will lose your credit cards.
- It is very difficult to get a mortgage or refinance after a bankruptcy.
- You typically must wait at least six years before re-filing for bankruptcy.
Before you file for bankruptcy, you should always consult with a Folsom bankruptcy attorney. A lawyer can help you understand your options, including alternative debt solutions. Moreover, a lawyer can help you prepare a financial plan that helps you recover financially and prepare for post-bankruptcy life.
Speak With a Folsom Bankruptcy Attorney
A consultation with a Folsom bankruptcy attorney is your first step towards financial freedom. At the Law Office of Diane Anderson, we combine a deep understanding of federal bankruptcy law with practical advice and skillful advocacy. We will help you retake control of your finances. Contact us today.