California Bankruptcy Laws

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How it works: California Bankruptcy Laws

Have you ever had a hard time of paying your debt? Was it ever so hard for you to pay your debt you were forced to sell all your valuable assets to pay it out of fear of the legal consequences of non-payment? Did you even sell things that have some sentimental value to you just to pay off your debts? Did you even your home just to pay your debts? You need not do those things. Knowledge of the laws is of great importance. One must not only be learned on how to keep up with life’s daily struggles but also, he must make sure that what he does is legal and appropriate. In the payment of debt, California Laws doesn’t require you to sell of your most treasured possessions just to pay of your debt. Under the laws of California, one can make a legal declaration of incapacity to pay off your debt. This legal declaration of incapacity to pay off your debt is called, bankruptcy. In this article, the reader will learn how to satisfy your debts without losing you most treasured possessions. How California Bankruptcy Laws will now be explained to you in detail. Let’s start.

A legal declaration of bankruptcy allows a person some leeway in the payment of his debt. The first step of this legal process is to file a petition for bankruptcy. One intending to file a petition for bankruptcy needs to spend about 185 dollars, in case of Chapter 13 of California Bankruptcy Laws, to 200 dollars, in case of Chapter 7 of California Bankruptcy Laws.  One might ask: “What is the difference between Chapter 7 and Chapter 13 bankruptcies?” While both Chapter 7 and Chapter 13 both speak of bankruptcy, they are actually very different. The legal declaration of bankruptcy under Chapter 7 is more famously called, straight bankruptcy. Under Chapter 7, the debtor who filed for bankruptcy will be appointed a trustee by the Court. Who is a trustee? A trustee is a person who is appointed by the court of competent authority entrusted with the power to sell the properties of the debtor who declared for bankruptcy. However, there is a limitation as to the properties that can be sold by the trustee. The trustee can only sell those properties which are declared by California Laws or Federal Law as non-exempt. For instance, under the California Laws of Bankruptcy, the family home of the debtor who declared for bankruptcy in an amount not more than 50,000 dollars for a single individual or 75,000 dollars for a family. Also, health aids, burial plots or alimonies cannot be acquired by the trustee to pay for the debtor’s debt as the same are exempted by law thereto. After all non-exempt properties are sold by the trustee, the proceeds thereof shall be given to the creditors of the debtor. The debtor then will be discharged from the payment of his debt even if the proceeds of the sale did not meet the amount of the debt.

Chapter 13 of California Bankruptcy Laws is actually a process by which the debtor is given the opportunity to pay his debt in a structure or plan that will best suit his means. This process is called, the reorganization bankruptcy. This type of bankruptcy is more appealable to many because in this type of bankruptcy they will be able to retain not only their properties with sentimental value, properties which are exempt by law from execution but also, even properties which are not exempt. Don’t just sell your properties right away just to pay off your debt. Avail of the remedy of bankruptcy provided by law. What do you know, with this remedy, you still might be able to find a way to pay off your debts without even selling one of your most treasured possessions. The declaration of bankruptcy is really the best way to save your property.

If you are wondering if bankruptcy is right for you, we would love to speak with you. Please give us a call at (909) 591-7800 for a free initial consultation. If you prefer to communicate via email, please use our secure contact form located in the right column of this page. We look forward to hearing from you.