Westlake Village Chapter 13 Bankruptcy Lawyer

Understanding Chapter 13 Bankruptcy in California

Many individuals overwhelmed by their liabilities (often in the form of debts) choose to file for bankruptcy to regain financial stability. Depending on your unique circumstances, such as your income, and whether you're filing as an individual or for a business, you will find yourself using one of several "chapters" to file for bankruptcy.

Chapter 13 bankruptcy is one of the most common types of bankruptcy filings, particularly for higher-income individuals who don't want to liquidate their property. A Westlake Village Chapter 13 bankruptcy attorney can help you move through the bankruptcy process with confidence.

For over three decades, I've worked with residents of California to help them file for Chapter 13 bankruptcy. To learn more about how my firm can help you with your bankruptcy case, contact me online or give me a call at (805) 633-4999.

What Is Chapter 13 Bankruptcy?

Chapter 13 bankruptcies are most often used by individuals who fail to qualify for Chapter 7 bankruptcy. To be eligible for Chapter 7 bankruptcy, your income must be under the median monthly income for your state (roughly $3,983 gross in California).

If you fail to meet the eligibility requirements for Chapter 7 bankruptcy, you will probably file for Chapter 13 bankruptcy. Filing for Chapter 13 bankruptcy involves filling out a variety of bankruptcy forms for your local bankruptcy court (a bankruptcy lawyer can help you ensure all forms are filled out correctly). These forms include details such as your income and how much debt you currently owe. To file for Chapter 13 bankruptcy successfully, you must have a steady income, and your debts must not exceed a certain amount. 

How Does Chapter 13 Bankruptcy Work?

Unlike Chapter 7 bankruptcy, property and assets are not sold to creditors to repay debts in a Chapter 13 bankruptcy. In other words, if you file for Chapter 13 bankruptcy, your property and assets will be safe from creditors.

Once you file for Chapter 13 bankruptcy, the Office of the United States Trustee appoints a bankruptcy trustee to your case. The bankruptcy trustee works as an independent contractor with the bankruptcy court to help you and your creditors reach an agreement. You must also receive credit counseling education from an agency approved by the Trustee's Office.

During the bankruptcy process, you'll draft a repayment plan proposal. Since you don't liquidate assets to pay off unsecured debts in a Chapter 13 bankruptcy, you need to come up with a repayment plan for your creditors instead. A bankruptcy attorney can help you draft a comprehensive debt repayment plan that not only allows you to repay your creditors but is also financially manageable for you.

Once you propose the repayment plan, the trustee will work with creditors to see whether they accept or reject the repayment plan. If your creditors reject the plan, you may need to modify the repayment plan to meet their demands.

Once the trustee and your creditors are satisfied with the repayment plan, the court will finalize the plan, and you'll need to start repaying your creditors.

During the repayment phase, priority debts (also called priority claims) take precedence. These debts include child support or alimony payments, as well as tax obligations. Secured debts, such as the mortgage for a house you want to keep or the payments for your primary vehicle, also take a front seat. These are debts you must repay in full.

You'll also need to put money towards unsecured debts, such as credit card balances or medical bills. However, unlike priority claims and secured debts, you don't need to pay these debts in full, or even at all (depending on the desires of the creditor). Instead, you're simply required to put money towards these debts as you can.

Bankruptcy Attorney with More Than Three Decades of Experience

How long your repayment plan lasts depends on your bankruptcy case, but many Chapter 13 bankruptcy repayment plans last around five years. A lot can change during that time. If your income decreases or increases significantly, it may be possible to work with a bankruptcy attorney and the bankruptcy court to modify your repayment plan to suit your current circumstances.

I have the tools to help you file for bankruptcy with confidence at the Law Offices of Jeffrey S. Graff. To work with a seasoned Westlake Village Chapter 13 bankruptcy lawyer who will handle your case with care and compassion, contact me online or via phone at (805) 633-4999. 

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