Resourceful Chapter 7 Bankruptcy Attorney in California
Chapter 7 bankruptcies offer an opportunity for an individual or a family to re-establish themselves. Most if not all debts are discharged, leaving you with the freedom to begin again without the financial burden that once weighed you down. But not everyone qualifies for Chapter 7 bankruptcy. In fact, for many of you, it may be the wrong option. It all greatly depends on your financial situation and the extent of your debt.
Mohsen Parsa, a resourcefulbankruptcy attorneyin Los Angeles and Orange County, will help you determine if Chapter 7 bankruptcy is right for you, and if it is, he will guide you through the process until your debts have been discharged and you are able to begin anew. Below is an overview of Chapter 7 bankruptcy in California. If you have more specific questions or want to begin the bankruptcy process now,contact Mohsen Parsatoday.
Who Qualifies for Chapter 7 Bankruptcy in California?
When a Californian resident isn’t able to pay his or her debt and is likely not to be in a position to do so anytime soon, Chapter 7 bankruptcy is often a good option, especially because it does not require a repayment plan. You must, however, qualify.
If your income falls under the median income for California, you automatically qualify for Chapter 7 bankruptcy if you cannot pay your debt. If your income does not fall under the median rate of income, then you must pass the Means Test.
The Means Test seeks to identify your disposable income. The more disposable income you have, the less likely you are to qualify. To determine your disposable income, you must:
- add all sources of income together (an average of the last six months); and
- subtract all necessary living expenses.
The number you end up with is your disposable income. It may all sound simple, but it’s not. TheIRS sets standards for living expenses, and oftentimes what the IRS says isn’t actually how people experience it.
For example, the IRS may only allow a family of four to allot $947 toward food each month, but you actually spend $1500 per month. There may be special needs or you may live in an area with a higher cost of living. An attorney can help you when the Means Test gets tricky and doesn’t always – on its face – seem representative of your true financial situation.
Mohsen Parsa will analyze the results of your Means Test and identify any red flags. The sooner these matters are addressed, the better it will be for you.
What is the Chapter 7 Bankruptcy Process?
Filing for bankruptcy successfully requires timely and accurately completing a series of steps. Though each bankruptcy is different, the steps are quite similar and include but are not necessarily limited to the following.
- Determine if you qualify for Chapter 7 bankruptcy.
- Take a credit counseling course.
- Complete the bankruptcy forms, including all schedules.
- File the bankruptcy forms.
- Attend a creditors’ meeting set up by the bankruptcy trustee.
- Allow the trustee to assess your assets, much of which will be liquidated or sold for the purpose of repaying creditors.
Once all of these steps – many of which overlap – and all your responsibilities are fulfilled, the court will approve the bankruptcy. Your debts that were the subject of the bankruptcy will be discharged.
What Assets Will Be Liquidated in a California Chapter 7 Bankruptcy?
Chapter 7 bankruptcy requires that you liquidate or sell your assets. The funds from the liquidation will be used to pay back the creditors part of what you owe them. Things like vehicles, jewelry, real estate, and more will be liquidated as part of the Chapter 7 bankruptcy process.
California, however, allows for considerable exemptions, including a homestead exemption. You may be able to protect your homestead equity, meaning it’s possible you won’t have to sell the home in which you live. Other assets could also be exempted. It’s important to disclose all your assets to your attorney so that you can protect them to the extent the law allows.
Contact a Smart Bankruptcy Attorney in Los Angeles Today
A Chapter 7 bankruptcy doesn’t have to be hard, but it does have to be completed and filed properly. Contact Mohsen Parsa, an attorney based in Los Angeles, at(949) 394-6930 to get started on your bankruptcy case today.