Bankruptcy in Irvine 
 

Thank you for visiting the Irvine Bankruptcy Law Offices of “insert attorney name”. 

If you are afraid to answer your phone because you know a creditor will be on the other end, it is definitely the time to contact our office; we can help you.  Also, please take a moment and visit our “Why hire us” page to see what makes us special from the other Bankruptcy attorneys in and around Irvine. 

Bankruptcy Overview

  • Filing for bankruptcy provides you with a fresh start – not a stressful road to the end.
  • Bankruptcy was authorized by the United States Constitution – legislation began in 1801.
  • Bankruptcy is a Constitutional right.
  • Laws allow individuals and businesses to liquidate assets or pay debts through a repayment plan.
  • Bankruptcy is common in the United States - millions of people file for protection every year.
  • Filing will prohibit collectors from bothering you.
  • Bankruptcy remains on your credit report for about 10 years.
  • Being a co-signer on a loan holds you responsible for any debt incurred.
 

Court location

  • Handles all bankruptcy issues.

  • Bankruptcy Court for Central District of California

    Ronald Reagan Federal Building & U. S. Courthouse

    411 West Fourth Street

    Santa Ana, CA 92701

    714-338-5300 

California Homestead Exemption Law

  • You can protect the equity in your home.
  • The exemption depends on:
  • Your age
  • Marital status
  • If you are up-to-date on your mortgage payments and the equity is equal to or less than the homestead exemption, you will be able to keep your home.
  • For a single person the exemption amount is $50,000
  • For a married couple the exemption amount is $75,000
  • The exemption amount increases to $150,000 if:
  • You are 65 or older
  • Have a physical or mental disability and cannot work
  • You are age 55 and have a low income
  • Chapter 7 can decide to sell your home; Chapter 13 is a better option.
 

Bankruptcy Reform Act

  • Also known as Bankruptcy Code
  • If you need to file for bankruptcy, you must first provide:
  • A Credit Counseling certificate
  • Proof of your income for 6 months – prior to filing
  • Current tax return
  • Financial Education certificate – prior to discharge
 
  • If your income is higher than the California median income, you must qualify under the Means Test before filing.
  • About 80-90% of people who apply, qualify.
 

Bankruptcy Types

  • The United States Bankruptcy Code, Title 11, offers several types of protection:
  • Chapter 7 – Bankruptcy Reform Act
  • Best option when you want to be totally free of debts.
  • You can only file for Chapter 7 protection once in eight years.
  • The filing fee is $299.
  • Non-exempt assets can be liquidated or sold to pay your creditors.
  • Most people filing for Chapter 7 have no non-exempt assets so unsecured debts are discharged.
 
  • Unsecured debts:
  •  
    • Medical bills
    • Credit cards
    • Bank loans
    • Past due utility bills
 
  • Once your petition is filed, an automatic stay comes into effect.
  • Protects you from:
  •  
    • Creditors contacting you by phone or letter
    • Lawsuits or judgments filed against you
 
  • You must first qualify through a Chapter 7 Means Test.
  •  
    • This compares your income to the median California income.
    • If income is less than median amount - you qualify
    • If more than median amount - the court will calculate your disposable income and unsecured debts to determine:
  •  
    •  
      • If disposable income for the next 5 years is less than $6,000 - you qualify.
      • If more than $6,000 but less than $10,000 – you can still qualify.

 

 

  •  
    • Cannot be discharged:
    • Child support payments that are late
    • Alimony payments
    • Tax debts that are current
    • Student loans
 
  • Chapter 13 – Wage Earner Bankruptcy
  • Filing fee is $274
  • An option when your income is too high to qualify for Chapter 7
  • Stops foreclosure of your home
  • Stops repossession of your automobile
  • U. S. Bankruptcy Law prohibits creditors from calling you or contacting you
  • Court-approved repayment plan - pay all or a partial amount of your debts during a 3 to 5-year period
  •  
    • Will make monthly payments to a court-appointed trustee
    • The amount depends on your income and expenses
    • Mortgage and automobile loans can be paid outside the plan or added to the plan
    • You have the option to give up the property and be relieved of the debt
  • A month after you file for Chapter 13 you must appear in court to discuss the repayment plan with the judge and trustee
  • Once you have completed all payments, a discharge order relieving you of all debts will be issued
 
  • Chapter 11 – Business Debt Reorganization
  • Option for businesses and corporations
  • Allows a business to continue to operate on a day-to-day basis
  • It gives you, the business owner, a chance to create a debt restructure plan
  • You can eliminate any lease or contract that is financially unfeasible
  • You will need the court’s approval to sell any assets from the business
 

Other Types of Bankruptcies

  • Chapter 9
  • Allows municipalities to readjust their debts
  • Constitutional restrictions do not allow assets to be liquidated
 
  • Chapter 12
  • Allows family farmers and fisherman to readjust their debts
  • Very rare in Irvine
 

 

Conclusion

If you’re considering bankruptcy, schedule a free consultation with a bankruptcy attorney in our office.  There is no obligation and no risk involved.  Call the Bankruptcy Law Offices of “insert attorney name” in Irvine as soon as possible.  You will get answers to your questions and be able to make an informed decision about what you’ll do next.