We’ve written about it on the blog, but California, and especially LA, is an expensive place to live. This leads Californians to looking for good information on how to deal with debt, and in some cases bankruptcy. Correct, reliable and up-to-date information is essential if you are thinking about filing for bankruptcy. Important questions about bankruptcy are answered below.
See also: How to Prepare for Bankruptcy
See also: Myths about Bankruptcy
Chapter 7 bankruptcy is often referred to as a “fresh start” bankruptcy because that is exactly what it is intended to provide. In California this is the most common type of bankruptcy filed by individuals. Chapter 7 wipes out most, if not all, of the filer’s unsecured debts.
Chapter 13 bankruptcy, on the other hand, is a 3 to 5 year long repayment plan that is typically filed when either the filer does not qualify for Chapter 7, or when Chapter 7 will not solve the filer’s problem. The determination of which Chapter you qualify for and which one makes the most sense is an important decision and is best made after consultation with an experienced bankruptcy attorney.
There are numerous other benefits to filing bankruptcy that we cover during our free in-depth consultation.