While bankruptcy can be a complex and often intimidating legal process, it provides much-needed relief from overwhelming debt. It can also give you a chance to start fresh free from your financial woes.

If you’re considering going this route, you probably have many questions. Keep reading to get familiar with bankruptcy, different Chapters, eligibility requirements, and more before you hire a trusted bankruptcy lawyer in La Mesa.

What are the different types of bankruptcies?

There are six different types of bankruptcy: Chapter 7, Chapter 11, Chapter 12, Chapter 13, Chapter 15, and Chapter 9. The most common types of bankruptcy for an individual are Chapter 7 and Chapter 13.

Chapter 7 bankruptcy allows you to discharge most or all of your unsecured debts (personal loans, medical bills, credit card debt, etc.) and get a fresh start. You must meet certain eligibility criteria and may be required to liquidate some of your assets for the benefit of your creditors.

Chapter 13 gives you a chance to reorganize your debts and pay them off over a period of three to five years. This type of bankruptcy requires you to make payments on your debts during that period. Any remaining debts should be discharged when the repayment period is complete. This type of bankruptcy is typically chosen by individuals who have a regular income but are unable to pay off their debts in full.  It is also used to stop a foreclosure or vehicle repossession.

What are the eligibility requirements for bankruptcy?

The eligibility requirements for bankruptcy depend on the Chapter. You must meet certain criteria to qualify and the best way to find out if you are eligible is to talk to an experienced bankruptcy attorney.

For Chapter 7, you have to pass a means test that compares your income to the state median income. Additionally, if you’ve had a Chapter 13 discharge in the last six years or a Chapter 7 discharge in the past eight years, you won’t be eligible.

To qualify for Chapter 13, you must have a steady income and be current on your tax filings. Also, your combined total secured and unsecured debts cannot exceed $2,750,000 according to the United States Courts. For both Chapters, you have to attend an approved credit counseling course.

When should you file for bankruptcy?

Generally, people should consider filing for bankruptcy when they’re no longer able to make their regular monthly payments, when their debt has become unmanageable, and when they’re facing serious financial hardship. Bankruptcy can provide a solution for those who are overwhelmed by debt as it’s an effective way to resolve these types of financial problems.

Do you need a bankruptcy attorney?

Yes, it is highly recommended that you hire a bankruptcy attorney when filing for bankruptcy. An experienced lawyer will provide you with the legal guidance necessary to navigate the complexities of the bankruptcy process and help you determine which type of bankruptcy is best for your particular situation.

This can include explaining how automatic stay works, helping you decide whether to file a joint bankruptcy with your spouse, considering the benefits of this option, and more.

Which bankruptcy lawyer in La Mesa should you hire?

If you’re struggling with debt, you need the help of skilled and experienced bankruptcy lawyers you can depend on, such as our experts at Chang & Diamond.

Our specialized attorneys ensure all the necessary paperwork is completed correctly and in a timely manner, help you maximize the benefits of filing for bankruptcy, and advise you on rebuilding your credit afterward.

It doesn’t matter if you’re located in La Mesa or nearby in San Diego County, all you need to do is give us a call and schedule a free initial consultation, and we’ll get to work.