Bankruptcy Attorney in Lake Elsinore
Get the Facts before you Call
If you’re seeking a bankruptcy attorney in Lake Elsinore, a little time spent in an attempt to better understand bankruptcy and how it works could be extremely helpful when hiring a competent lawyer. This is because bankruptcy is a complex set of laws that differs from state to state, and bankruptcy legislation is prone to changes in response to current economic events. Therefore a basic understanding of bankruptcy can help you better communicate your needs to a Lake Elsinore bankruptcy attorney.
There are two primary types of bankruptcy for individuals:
CHAPTER 7 – LIQUIDATION BANKRUPTCY
This is the most common type of bankruptcy in the United States and generally seeks to completely dissolve most types of debts. Chapter 7 bankruptcies are often filed by individuals who cannot pay any debts beyond their basic living expenses. These filers are often permitted to keep personal property such as jewelry, clothing, limited cash, and other items. Property and assets that have equity above a certain threshold may be sold by the bankruptcy court and distributed among any creditors. Property that does not have significant equity in it is usually retained by the owner. This provision of bankruptcy protection allows thousands of American families to keep their homes every year.
Requirements can be tricky, so it’s best to consult with a professional bankruptcy attorney in Lake Elsinore to be sure you meet all of the guidelines. In general, your financial situation must pass a standardized means test that will determine how much- if any- disposable income you have.
Another requirement is to have completed a government-approved consumer credit counseling service sometime in the 6 months prior to filing for bankruptcy. As a follow up to this requirement, filers must also attend a debtor education course before the case is discharged.
CHAPTER 13 – REORGANIZATION BANKRUPTCY
Hiring a bankruptcy attorney in Lake Elsinore is critical if you have disposable income but have been unable to get back on track with creditors. In this case Chapter 13 reorganization can be extremely beneficial. This type of bankruptcy allows a filer to keep all of their property, assets and personal belongings. It also stops all collection efforts on the part of creditors. In return, you’ll be required to submit to a court-approved plan to repay your creditors under a restructured debt program spread out over not more than five years.
This plan must pay your creditors at least what they would have received if you had filed Chapter 7 – which means that you could pay substantially less than what you actually owe. Additionally, the plan cannot be approved if creditors object to it, or if any of your debts are determined to have been incurred fraudulently. There are a great number of nuances to these rules and requirements; consulting with a professional bankruptcy attorney is always the safest recourse.
Regardless of which chapter you file, you can quickly recover from a bankruptcy if you educate yourself, are conscientious about your debt plan and work with a high quality bankruptcy attorney in Lake Elsinore.