If you live in the San Diego or Imperial counties this Debt Free League Blog review will help you make a more informed decision on filing San Diego bankruptcy.
Court Venue: U.S. Bankruptcy Court
Chamber 1: Room 218
Chamber 2: Room 118
Chamber 3: Room 129
Chamber 4: Room 328
Chamber 5: Room 318
San Diego bankruptcy can be a great step helping people in debt to gain a fresh start. But, observing the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA), the rules have become more rigid. The following information will help you determine if you should consider this debt elimination solution.
San Diego Bankruptcy (Chapter 7):
San Diego bankruptcy filers that can’t repay predominantly file for Chapter 7. Such bankruptcy discharges most debts and does not require filing a plan of repayment like Chapter 13. As such, attorney fees for a Chapter 7 case are generally lower than for Chapter 13 cases.
There are three main downsides of San Diego bankruptcy via Chapter 7:
1) To start a Chapter 7 bankruptcy case, the debtor must first pass a means test, which determines to the bankruptcy court if the debtor can pay back at least a portion of the debt;
2) Chapter 7 requires surrendering your nonexempt property to a bankruptcy trustee to be liquidated and have the proceeds distributed to unsecured creditors;
3) Not all debts can be discharged in Chapter 7, such as alimony and child support, certain taxes, educational debt, and government-guaranteed loans.
San Diego Bankruptcy (Chapter 13):
Chapter 13 is recognized as the Wage Earner’s Plan because it is typically filed by San Diegans that are actively employed. You would file this type of bankruptcy in order to retain ownership and possession of assets. But, in exchange, a portion of your income must be dedicated to repay debts that you owe to creditors.
You must generally repay 30-50% of your debt through a court ordered debt repayment plan. The value of your property and income/expenses determines the amount of the Chapter 13 debt repayment plan and the repayment period, which takes 3 to 5 years.
A major downside of Chapter 13 is that you can’t miss any of your payments. Otherwise, the bankruptcy trustee is likely to motion San Diego bankruptcy court to dismiss your case.
Other “Should I File Bankruptcy” Concerns…
Don’t fall for the low-ball bankruptcy ads. In truth, aside from having to pay attorney fees, San Diego bankruptcy also has court filing fees. As required by the United States Bankruptcy Court, Southern District of California [28 U.S.C. §1930], effective 10/01/08 to 11/01/11, the Chapter 7 case court fee is $299.00 to 306.00 ($245 filing fee; $39.46 administrative fee; $15 trustee surcharge). The Chapter 13 case court fee is $ 274.00 to 281.00 ($235 filing fee, $39 46 administrative fee).
Another issue is that prior to filing San Diego bankruptcy, the new bankruptcy code also requires you to get credit counseling from an approved consumer credit counseling agency. Plus, you must get personal financial management education from an approved consumer credit counseling agency before your bankruptcy case can be discharged.
If you don’t qualify for Chapter 7, you don’t want to risk having to liquidate valued assets, or own a great deal of nonexempt property that can’t be discharged through bankruptcy, you ought to consider another debt elimination option. A good one is the Debt-to-Freedom Plan. Similar to Chapter 13, this bankruptcy alternative helps you repay a small fraction of what you owe. And, the massive savings can get you out of debt in a short 12 to 36 months. Best of all, unlike a Chapter 7 bankruptcy, it won’t force you to surrender nonexempt property.