How does Bankruptcy Work in California?
Bankruptcy is a process that most people fear and dread, though it can be life changing, it does not have to be life ending. Understanding how the bankruptcy process works, deciding to bankrupt, filing papers, allowing creditors to make claims and more, can help ease your mind and make the process easier to go through. Though it will always be challenging, the more information you are armed with, the better in terms of getting your life back on track after financial crisis.
Can I Be Made Bankrupt?
This is a question that gets asked a great deal. Though no one can physically make you file for bankruptcy, you can be pushed to the point that you feel that bankruptcy is the only option. No one can force you to file for bankruptcy, not even a debt collector that holds a substantial amount of your debt.
In cases where you are being pushed toward bankruptcy, you can always restructure your debt and keep paying, you can fight some debt in court if you feel it is in unjust, and you can get help with your debt through debt counselling. Ultimately, bankruptcy is your decision and no one can force it.
Can you Be Denied a Student Loan Because of Your Parent’s Bankruptcy?
Student loans have helped millions of people get through school and start careers that they are happy with and that they can grow in. That being said, there are strict regulations and rules that go along with student loans in order to get them and to take out the money they provide.
In most cases, your credit does play into whether or not you can take out a student loan and whether or not it is going to be beneficial for you ultimately.
If your parents have filed for bankruptcy in California, this is public record and it must be disclosed if they are filing for the student loan with you. If their credit has been damaged by a bankruptcy they can be turned down for the loan.
This does not mean that you are going to be turned down for the loan, just that your parents are not going to be able to be co-signers on that loan. You can still take out a student loan even if your parents have been bankrupted before, you just may not be able to use them as a co-signers on the loans.
Can I Get Rid of Taxes in Bankruptcy, Including Income Tax to the IRS, the FTB or Sales Tax?
Discharging taxes is a bit different than discharging the debt that you owe for using your credit card too much. You can however discharge tax debt if you choose the right kind of bankruptcy to file. A chapter 13 bankruptcy in California, which is what most people use to file for personal bankruptcy, is not going to have anything to do with tax debt.
If you want to file bankruptcy to get rid of tax debt you need to file a chapter 7 bankruptcy, this is the only type of debt that this bankruptcy handles. This does not mean that you can file and get forgiveness on your most recent debt, this type of tax return handles tax debt that is at least three years old. You may still run up against fees and other penalties that you have to pay, but you can get a clean slate and can get free of tax debt in this way.
Can I Remove Liens Against My Property?
You can remove some types of liens with bankruptcy but there is still a chance that you will lose the property. With debt that is associated with liens, the lien has to qualify for bankruptcy and it has to qualify for dismissal. When you file bankruptcy in California, the debt that you have is tallied up and all the creditors that hold that debt are notified.
If you own a property that has a lien that creditor is going to be notified when then bankruptcy is filed, this means that they are going to have the chance to come and force the sale of the property to help settle the debt before your bankruptcy can go through.
How Do I Know What Exemptions I have in Bankruptcy and how Much I can Protect my Assets in California?
Your bankruptcy attorney is going to be able to help you figure out just what you can exempt, what you can do to avoid your assets being taken, and can help you to figure out just what you can and need to protect to prevent your items being taken. Taking the time to make sure that you talk with your attorney about what you can exempt, what you want to keep and what you need to keep can help you get your bankruptcy off to a great start and completion.
Most states allow you to keep your residence to a certain monetary amount, your car up to a certain amount, and the things that you need to live and things like personal affects as well.
Is It Too Late to File Bankruptcy in California if I am Being Sued or Already have a Judgement Against Me?
Though you might think that filing bankruptcy in California after a judgement has been entered against you is out of the question, most states will allow you to move forward with a bankruptcy despite the summons.
You can file if you have not filed within the last 7 years and can dismiss that debt so that you can move on and start to live your life without debt. Taking the time to talk with your lawyer can help you learn just what you can do in terms of how bankruptcy works in California and you can find out more about your bankruptcy and what is going on.
Bankruptcy can be difficult, with a great lawyer you can get the information about your bankruptcy and you can find out more about the process as a whole and the process that you need to go through.
If you need bankruptcy help but have reservations, you’re not alone. At Berneman Law Firm, we have a team of experienced lawyers who can take care of all your problems.