Falling into financial hardship isn’t as difficult as some may believe. All it takes to get behind on your bills is a job loss, sudden death of a primary earner, unexpected medical debt, or another financial emergency. If you are facing a mountain of overwhelming debt, you need a guide who can help you overcome it with bankruptcy. We at The Fuller Law Firm, PC can help our clients achieve consumer debt relief by assisting them through Chapter 7 or Chapter 13 bankruptcy. We understand that this is often a difficult and sensitive time for our clients, so rest assured that our attorney and staff members will treat you with the dignity and respect you deserve. We can also ensure you are fairly treated during bankruptcy proceedings and that your rights are protected throughout the process.
What Is Chapter 7 Bankruptcy?
Chapter 7 bankruptcy is also known as “liquidation” bankruptcy. This is because the bankruptcy filer’s eligible assets and property are collected and liquidated by the bankruptcy trustee. The resulting proceeds are used to pay creditors, and the remaining debt is discharged through a court order. Most people fear they will lose everything in Chapter 7, but this is generally not the case. California provides two series of bankruptcy exemptions (704 Series and 703 Series) that allow people to protect important personal property such as clothing, furniture, appliances, and tools of their trade. They can also protect equity in their homes and vehicles. If you have more questions about Chapter 7 bankruptcy, we encourage you to get in touch with our bankruptcy lawyer in Mendocino to learn more!
What Is Chapter 13 Bankruptcy?
Chapter 13 bankruptcy involved debt reorganization rather than an outright discharge of debt. During this type of bankruptcy, the filer meets with their creditors and proposes a plan to repay their debt within three to five years. Any debt remaining after the successful completion of this plan can be discharged by the court. Chapter 13 is usually the preferred bankruptcy type for those with significant secured debt. This means that unlike credit card or medical debt, their debt is secured by collateral such as their home (in the case of a mortgage) or car (in the case of an auto loan).
Unpaid past-due payments on secured debt accumulate as arrears, and the goal of a Chapter 13 reorganization plan is to pay off arrears and other unsecured debt over time. This allows the Chapter 13 filer to keep their property for as long as they abide by the repayment plan and if it satisfies the arrears.
Bankruptcy Stops Creditor Harassment & Collection Actions
If you’re in debt, you’re probably sick of the letters and phone calls you get from your creditors. You’re probably also weary from collection actions such as wage garnishment, foreclosure proceedings, and threats to take actions like these. When you file for bankruptcy, all of it stops. For as long as your bankruptcy case is open, the letters and phone calls should stop coming, wage garnishment should cease, and foreclosure is put on pause. Interest also stops accruing on your past-due debt. Once that happens, you can breathe a sigh of relief and focus on eliminating debt with bankruptcy.
Will Bankruptcy Hurt My Credit Score?
Yes, but the impact isn’t forever. Once you complete bankruptcy, you might find it easier than you previously believed to find creditors willing to offer credit, albeit with tight restrictions. Your credit score should rise as long as you work on repaying new debt on time.
Bankruptcy will show up on your credit report, but only for as long as 10 years if you filed for Chapter 7 and seven years if you filed for Chapter 13. After this point, bankruptcy will fall off of your credit report and it’ll be like it never happened.
Get the Debt Relief You Need. Call (408) 465-4472 Today!
If you need debt relief, our bankruptcy attorney in Mendocino can provide the legal support you need. The Fuller Law Firm, PC has more than 40 years of combined legal experience and has successfully filed more than 4,000 cases in that time. We provide each client with personalized assistance, which means you can expect us to treat your case at an individualized level and focus on what matters most to you.
Ask about a FREE case evaluation when you contact The Fuller Law Firm, PC online today.
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