You have made sound financial decisions for most of your life. However, bad things do happen to good, smart people. And even one small decision or action can wreak financial havoc on all aspects of your life. When you find yourself upside down financially with no room to make things better, your only option out of the financial sink hole may be to file for bankruptcy.
But what does filing for bankruptcy really mean?
What Is Bankruptcy?
Bankruptcy is a legal process that allows you to seek relief from some or all of your debts that you are no longer financially able to pay off. Bankruptcy will not only allow debtors to get some relief, but at the same time help people who are owed money, or creditors, to get paid from assets property the debtor has.
What Happens to Your Money When You File Bankruptcy?
When you, or your Stockton bankruptcy attorney, file for bankruptcy, a discharge from the court will relieve you of your obligation to repay your creditors for certain types of debt. When the court-approved specific debts are officially discharged, your creditors will not be legally permitted to contact you or attempt to collect the debt you once owed them in any way.
Your attorney will help you determine the types of debts that filing a bankruptcy will help clear. It should be noted, however, just because your debt may qualify for forgiveness, it does not mean that the court will ultimately allow it to be discharged in full.
Will You Lose Everything by Declaring Bankruptcy?
Not everything you own is lost or forced to be put up for sale as part of a bankruptcy proceeding. In most cases, you can keep household furnishing, a retirement account, and some equity in your house, and your car when you file for bankruptcy. However, the court will force you to give up unnecessary luxury items, such as a flashy car or jewelry, to pay off your debt. In some case, you may be allowed to pay to keep some luxury items.
How Much Money Can You Have in the Bank When Filing Bankruptcy?
This is a case specific answer because there is no set exemption for cash in a bank account when you file bankruptcy. However, if your Stockton bankruptcy lawyer can prove to the court that you need the money in your bank account to live on for the next few weeks until your next income, you may not have to realize on this asset.
How Long Do Bankruptcies Take to Settle?
Most Chapter 7 bankruptcies take about four to six months to complete, from the date you file to when you receive a final discharge. However, different factors can and will impact the length of time it will take for a final discharge. Your attorney may be able to give you a better time line.
Call an Experienced Stockton Bankruptcy Attorney
If you are considering Chapter 7 bankruptcy, it is in your best interest to consult with an experienced bankruptcy attorney to help you learn your legal rights and options, especially with respect to Chapter 7 bankruptcy. For more information or to schedule a complimentary consultation with Central Valley bankruptcy attorney Gurjit Srai, please call 209-323-5558, or complete our online form.