Chapter 7 Bankruptcy Lawyer Serving Los Angeles, California
If you struggle to pay your bills each month, your best option for tackling your debt may be a Chapter 7 bankruptcy. A Chapter 7 bankruptcy discharges your unsecured debts and allows you to start with a clean slate. Not everyone is eligible for a Chapter 7 bankruptcy, and a Chapter 7 bankruptcy might not be your best option, depending on your financial circumstances. An experienced bankruptcy attorney can help you assess your finances, explore your options, and choose the best course of action.
The Law Offices of Kourosh Pourmorady has over 47 combined years of experience with handling hundreds of Chapter 7 bankruptcy cases. Our law firm believes in personal, customized, and compassionate representation for underserved and vulnerable populations. We want to assist you with saving your home, your car, and your happiness. Call The Law Offices of Kourosh Pourmorady today at (866) 666-6529 to discover how a Chapter 7 bankruptcy can help you start fresh. We serve clients in the greater Los Angeles and surrounding areas.
Eligibility for Chapter 7 Bankruptcy
Chapter 7 bankruptcy is governed by the federal Bankruptcy Code. The Bankruptcy Code outlines strict requirements for Chapter 7 eligibility. Chapter 7 is open to both individuals and businesses.
The Means Test for individuals is used to determine whether their income qualifies them for Chapter 7, regardless of their debt level. The Means Test will assess your income and the value of your assets to determine your ability to pay your debts. If your income is below the threshold, you will be permitted to file for Chapter 7 bankruptcy. If your income is above the threshold, another form of bankruptcy such as Chapter 13 may be more suitable to your needs.
A filing under Chapter 7 requires that the debtor first undergo credit counseling within the 180 days preceding the filing. If the debtor develops a debt management plan with the credit counselor, it must be filed with the Chapter 7 petition.
In addition, if, in the past 180 days, you have previously filed and voluntarily dismissed a bankruptcy petition or if you previously filed for bankruptcy but failed to appear for a hearing, you must wait before filing under Chapter 7.
What Debts Can Be Discharged under Chapter 7?
Only individual debtors are eligible for discharged debts. In addition, usually only unsecured debt can be discharged. Unsecured debt is not tied to any assets, and typically includes:
- Personal loans
- 401k loans
- Payday loans
- Credit cards
- Medical bills
- Student loans*
- Taxes owed to the government
- Cellphone, internet, and cable bills
- Rent payments
- Child support payments
*However, not all unsecured debt can be discharged without extenuating circumstances. This includes student loans, child support payments, and criminal restitution.
Secured debts are debts that are secured by an asset. For instance, a home mortgage is secured by your house. If you default on your mortgage, the bank can foreclose on the home and reclaim it. Some secured creditors may attempt to seize the secured property during a Chapter 7 bankruptcy. Your primary home and your primary car, if necessary to drive to work, will be protected from seizure. However, other assets tied to debt can be seized, such as boats.
In addition, you may be forced to liquidate some of your assets in order to help satisfy some of your debts. Thus, if you have a valuable baseball card collection, you will be unable to keep the collection following the bankruptcy. You will be forced to disclose the collection and its value to creditors at the onset of your case. Anything that is not essential may be seized or liquidated with proceeds going to creditors.
If you do wish to keep a home or car that you have a loan on, Chapter 7 bankruptcy will permit you to retain this property and remain in payment. This debt will not be discharged. Rather you will continue to make timely payments as agreed in order to keep the property.
Call Now for Chapter 7 Legal Assistance
If you believe Chapter 7 is right for you, contact The Law Offices of Kourosh Pourmorady today at (866) 666-6529 for a free initial case review. Our attorneys can help you determine if your income satisfies the means test, explain the bankruptcy process, and gather the correct materials for filing.