Having a large amount of debt can be stressful. You may be worried about making the next payment on your home mortgage, car, or credit cards. Or you may have been unable to make a payment and be worried about an impending foreclosure, repossession, or debt collection lawsuit.

It is important to remember that you are not out of options. Although you may not have considered it, filing for bankruptcy can help you to protect your assets and/or wipe away your debt.

Filing for Bankruptcy in San Ramon

Although income levels in San Ramon are, on average, higher than those in many other cities, this also means that residents have higher levels of debt. Usually, high-income individuals accumulate more debt than lower income individuals because they have the means to make higher monthly payments. However, debt can be a vicious cycle and it is easy to accumulate too much credit card debt, or to fall behind on payments because of a medical emergency.

The two types of bankruptcy that are available to individuals in San Ramon are Chapter 13 Bankruptcy and Chapter 7 Bankruptcy. Chapter 13 Bankruptcy involves re-organizing your finances to pay back some or all of your debts, whereas Chapter 7 Bankruptcy involves selling some of your assets in order to wipe away your debts.

Qualifying for Bankruptcy

Which type of bankruptcy is best for you will depend on your particular financial situation. However, there are different criteria to qualify for Chapter 7 and Chapter 13 Bankruptcy.

To qualify for Chapter 7, an individual must either:

1.  Have an income that is lower than the median income in California for a household your size; or

2.  If your income is higher than the median, not have enough disposable income to make payments on your debts.

This second calculation involves taking the “means test” and can be complex. It is important to consult with an attorney about whether you qualify.

In order to qualify for Chapter 13 Bankruptcy, you must have a steady source of income and be able to pay a significant portion of your debts. Part of Chapter 13 is proposing a three-year or five-year payment plan to the bankruptcy court. The plan must show how you propose to pay back some of your debt. After you successfully complete the plan, your remaining unsecured debts will be wiped away.

Bankruptcy’s Automatic StayAnother way in which bankruptcy can help San Ramon residents is through the automatic stay. Immediately upon filing for Chapter 7 or Chapter 13 Bankruptcy, the automatic stay takes effect. The stay is an automatic injunction (court order) which prevents creditor activity such as a:

• Home foreclosure;
• Car repossession;
• Bank levy
• Debt collection lawsuit; or
• Wage garnishment.

Unless the creditor is able to successfully petition the court to lift the automatic stay, it will remain in effect for the duration of the bankruptcy. For Chapter 7, this is usually about four months, and in Chapter 13 Bankruptcy the stay can remain in effect for up to five years.

Contact a Bankruptcy Lawyer

If you live in San Ramon or a surrounding area and are considering filing for bankruptcy, it is important to contact an attorney as soon as possible. Filing for bankruptcy requires attention to every detail. Failure to fill out a form correctly or disclose an asset can result in a dismissal of the bankruptcy. This can cost you time, attorney’s fees, and prevent you from re-filing for bankruptcy. The Law Offices of Melanie Tavare have years of experience helping individuals get rid of their debt in Chapter 7 or Chapter 13 Bankruptcy. To speak with an experienced lawyer in the San Ramon area, contact us online or call us at 510-255-4646.

The Law Offices of Melanie Tavare are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.