For most consumers, life before bankruptcy is fraught with financial difficulties. It is important to remember that although bankruptcy is not the first resort, it is best not to wait too long to take action. If you are facing what seems to be insurmountable debt, contact an attorney at once in order the make the best of a bad situation.
About the Bankruptcy Process
The bankruptcy laws are powerful tools that can be used to obtain debt relief.
At the Bankruptcy Law Offices of Stephen Johnson, known as Sierra Legal Services, we are experienced bankruptcy practitioners who work to obtain maximum debt relief for our clients while enabling them to retain as much property as possible.
Some general information about bankruptcy appears below. You probably have additional questions about what can be done to help you obtain debt relief.
In a free consultation, an attorney at our firm can review your situation and recommend the right solution for you.
Free Consultation with a Lawyer
For a free consultation with the Bankruptcy Law Offices of Stephen Johnson in Auburn, California, call 530-392-4883 or 888-309-2873 or send us an e-mail.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
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Debt relief is possible without resort to bankruptcy. Our firm can work to obtain a loan modification for you, which can reduce your outstanding mortgage loan principal, your interest rate, the length of your mortgage or some combination of these.
Filing for bankruptcy can reduce or eliminate unsecured debts such as credit card debts and medical bills. The Bankruptcy Law Offices of Stephen Johnson will use the bankruptcy laws to obtain debt relief for you.
Exempt vs. Non-exempt Property Under Chapter 7
In a Chapter 7 liquidation case, the debtor must relinquish certain property to the bankruptcy trustee so that he or she can sell the property and use the proceeds to pay off debts. Property of the bankruptcy estate is broadly defined under Section 541 of the Bankruptcy Code. The estate is technically the legal owner of all of the debtor's property and consists of all legal and equitable interests that the debtor has in property at the initiation of the bankruptcy case. Income that the debtor earns after the date of the petition is not included in the estate. Debtors, whether they are businesses or individuals, are often justifiably concerned about what property they will be allowed to keep and what they must give up. A bankruptcy lawyer at Sierra Legal Services, Inc. in Auburn, California, can answer these and other questions, allay fears and keep the process moving forward as painlessly as possible.
A debtor must file a schedule of exempt property with the court. Exempt property is property that the debtor can protect from liquidation. The Bankruptcy Code allows each state to adopt its own exemption laws, which the debtor can select instead of the federal exemptions. It is important to consult with an attorney who can explain the exemptions available under your state's laws and how they compare to the available federal exemptions.
Non-exempt Property
Items that the debtor usually must forfeit include:
- Expensive musical instruments, unless the debtor is a professional musician
- Collections of stamps, coins and other valuable items
- Family heirlooms
- Cash, bank accounts, stocks, bonds and other investments
- A second car or truck
- A second home or vacation home
Exempt Property
Certain types of property are exempt, meaning that the debtor can keep that property. Exempt property includes:
- Motor vehicles, up to a certain value
- Reasonably necessary clothing
- Reasonably necessary household goods and furnishings
- Household appliances
- Jewelry, up to a certain value
- Pensions
- A portion of the equity in the debtor's home
- Tools of the debtor's trade or profession, up to a certain value
- A portion of unpaid but earned wages
- Public benefits, including public assistance (welfare), social security and unemployment compensation, accumulated in a bank account
- Damages awarded for personal injury
Speak to a Bankruptcy Lawyer
If you have questions about what property you will be allowed to retain if you file for bankruptcy under Chapter 7 of the Bankruptcy Code, it is prudent to seek the counsel of an experienced and knowledgeable bankruptcy attorney at Sierra Legal Services, Inc. in Auburn, California, who can respond promptly and accurately and put your mind at ease.
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