A common misconception about bankruptcy is that bankruptcy is only for people who have little or no income. This simply is not true. There are different types of bankruptcy that are available, each of which is designed to suit the needs of individuals who are in different financial situations. However, all types of bankruptcy have a common purpose – to help people who are overwhelmed with debt to get a fresh financial start.
The two types of bankruptcy that are available to individuals in the Pleasanton area are Chapter 7 Bankruptcy and Chapter 13 Bankruptcy. If you have a large amount of unsecured debts such as credit card debt, medical bills, utility bills, or personal loan, you may want to consider contacting a Pleasanton Bankruptcy Attorney to find out if bankruptcy is a good option for you
Residents of Pleasanton are, on average, wealthier than many other cities in the United States. However, people with higher incomes tend to take on higher amounts of debt because they can afford to make larger monthly payments. A catastrophic financial event like a medical emergency or temporary unemployment can quickly make meeting payment obligations impossible or difficult. You may need additional time to catch up on your payments. This is what Chapter 13 Bankruptcy is for.
Chapter 13 Bankruptcy is a type of bankruptcy that is only available to individuals with a steady income who are able to pay a significant portion of their debts. In Chapter 13 Bankruptcy, debtors propose a three-year or five-year payment plan for how they plan to pay some of their debts. After the payment plan is complete, any remaining unsecured debts are wiped away.
During the entire course of the bankruptcy, an “automatic stay” will remain in effect. This stay operates as a shield against creditors, and can prevent creditor actions such as:
Unlike Chapter 13, Chapter 7 Bankruptcy is a type of liquidation bankruptcy. In Chapter 7, an individual sells or liquidates all of their non-exempt assets and uses the proceeds to pay as much of their debt as possible. Any remaining unsecured debt is wiped away.
The good news is that California has a system of property exemptions which debtors can use to protect assets like a house, car, or retirement savings from liquidation in Chapter 7.
In Pleasanton, Chapter 7 Bankruptcy is limited to individuals who 1) have an income that is less than the median income for a household their size in California, or 2) do not have enough disposable income to make payments on their debts. This second calculation can be complex, and it is important to consult with an attorney to find out if you are eligible for Chapter 7.
The Law Offices of Melanie Tavare are proud to serve residents in Pleasanton and the surrounding communities. We understand that being overwhelmed with debt is a stressful experience, and we work hard to help individuals get rid of their debt so that they can move on with their lives. If filing for bankruptcy is an option you would like to consider, contact us online or call us at 510-255-4646 for a confidential consultation.
The Law Offices of Melanie Tavare are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.