EXPERIENCED AND TRUSTED TURLOCK BANKRUPTCY LAWYERS
Local Turlock Bankruptcy Lawyers with Proven Results and Satisfied Clients
For most Americans, taking on debt has simply become a regular part of life. Debt is not a bad thing, as it allows us to purchase homes and vehicles and cover certain emergency expenses that we may not have the means to cover. However, there are certain circumstances when debt can feel as if it is taking over your life, effecting your wellbeing and the wellbeing of your family. Since the Pandemic, an alarming number of individuals and families are finding themselves falling further into debt in an attempt to continue to stay in their home, keep their mode of transportation, and ultimately, just being able to put food on the table. The problem arises when each month, the debts continue to increase, creating a growing pressure on your finances and general wellbeing. For many, dealing with debt has never been an issue, and now when faced with increasingly alarming amounts of debt, people are struggling to get out and free from debt and don’t even know where to begin.
Fortunately, Pauldeep Bains Esq. and Simran S. Hundal Esq. are highly experienced bankruptcy attorneys who put YOU, the client, first, ensuring that you can clearly and easily understand how we can help solve your debt issues by way of filing for bankruptcy, while supporting you throughout the process. Combined, Mr. Bains and Mr. Hundal have nearly 20 years of experience helping individuals in the Turlock area navigate the complex bankruptcy laws and working hard to get their clients successful bankruptcy discharges. No matter how overwhelmed you may feel, rest assured that there are options to help you. To begin the journey to regaining your financial future, Mr. Bains and Mr. Hundal proudly offer free consultations to help provide you the information you need for your specific situation and offer the best possible solution for you. You can click here to schedule your free consultation with high quality Turlock Bankruptcy Lawyers.
Why choose a Local Turlock Bankruptcy Lawyer?
When choosing a bankruptcy lawyer, you want a local attorney who is well versed in both the federal bankruptcy code as well as any local rules. It is common for local bankruptcy trustees and judges to have their own additional requirements, and Mr. Bains and Mr. Hundal have gained the valuable knowledge as to what is needed to file for our clients in Stanislaus County. With our office strategically situated in downtown Modesto, just a block away from the Bankruptcy Court, we make it convenient for our clients to come in for meetings and drop off their documents.
Additionally, you want a Bankruptcy Firm that offers the latest in technology to help serve your needs as best as possible. To best serve our local Turlock clients, we utilize the latest in attorney/law firm management software, an on call answering service, and make it easy and convenient to e-sign and submit documentation.
What is Bankruptcy and What Will an Experienced Turlock Bankruptcy Lawyer Do for Me?
In brief, Bankruptcy refers to Federally enacted laws, regulations and procedures that are meant for the purpose of providing aid to those in debt by allowing them to get a new start by liquidating their non-exempt assets to pay their debts or through the creation of a payment plan to repay back debts. At the end of the bankruptcy process, the debtor will receive a discharge of certain debts and no longer be obligated to repay them. There are several types of bankruptcies available, however, the two most common types are a Chapter 7 and a Chapter 13 Bankruptcy. In fact, Mr. Bains and Mr. Hundal practice exclusively in Chapter 7 and Chapter 13 Bankruptcies, allowing them to focus their efforts and gain knowledge in these specific areas, resulting in providing the most effective results to their clients.
What is Chapter 7 Bankruptcy?
A Chapter 7 Bankruptcy is the most common type of bankruptcy to be filed and it is commonly referred to as a complete liquidation bankruptcy. This means that once you file for Chapter 7, the Trustee will be able to sell off your non-exempt assets and use those proceeds to pay off some or all your creditors, and in exchange you receive a complete discharge of all your debts that are eligible for discharge. Before you get worried about having your things sold off, it is important to note that our experienced attorneys can in most situations protect most, if not all, of your assets from being sold by the Trustee. That means that oftentimes, our clients will be able to obtain a complete discharge without having any of their assets sold.
Who qualifies for Chapter 7 Bankruptcy?
To qualify for a Chapter 7 bankruptcy, one must either be an individual/married couple, a partnership, corporation, or other business entity. First, to qualify under Chapter 7, the debtor must not have received relief under a prior Chapter 7 bankruptcy within the past 8 years (from the filing date of the last Chapter 7 to the filing date of the new Chapter 7 bankruptcy). Next, the Bankruptcy Code requires that a debtor qualify under the “Means Test.” The Means Test is used to determine whether your income is low enough to file for Chapter 7 and is meant to exclude higher income earners from obtaining a complete discharge of their debts when they can afford to pay their creditors.
How does the Means Test Work?
To determine if a debtor has a low enough income where they are unable to repay their creditors, they must pass the means test. If a debtor passes the means test, they automatically qualify for Chapter 7 Bankruptcy. The means test works by first determining if the debtor’s current monthly income is more or less than your state’s median income based on your family household size. These household income values are determined and adjusted annually. To calculate current monthly income, our attorneys will look at your gross income from the past six (6) months, and multiply by 2. If the resulting calculation is less than the medium income for your household size, you qualify for Chapter 7.
What If You Don’t Pass the Means Test?
For those debtors who do not pass the means test, there is still hope for you to qualify for Chapter 7 bankruptcy. Our experienced attorneys will take the next step to determine your disposable income to see if you may still qualify for relief under Chapter 7. To calculate your disposable income, our attorneys will deduct certain monthly expenses and court allowed deductions from your monthly income. Your disposable income is used to determine if you can repay at least a portion of your unsecured debts. The higher your disposable income, the less likely you are to qualify for Chapter 7 Bankruptcy relief.
What is the Chapter 7 Bankruptcy Process?
For those that qualify for relief under a Chapter 7 Bankruptcy in Turlock, it is important to have a clear understanding of the Chapter 7 Bankruptcy Process. First, a Chapter 7 Bankruptcy Voluntary Petition is filed with the local Bankruptcy Court. For our Turlock clients, the local bankruptcy court is conveniently located in downtown Modesto, CA. Just because you are married does not mean that your spouse must file for Chapter 7 Bankruptcy along with you. It is not uncommon for only one spouse to seek relief by filing for Chapter 7 on their own. However, it is also common for married coupled to file jointly, especially when the family has taken on a significant sum of debt together. Another advantage of filing jointly is that both spouses only need to submit one voluntary petition and only pay the applicable filing fee once. Next, immediately upon the filing of the voluntary petition, the Automatic Stay will go into effect. The Automatic Stay is a protection afforded under the Federal Bankruptcy Code that puts an immediate halt to all creditors, lawsuits, wage garnishments and other collection efforts until the Chapter 7 Bankruptcy has either been dismissed or completed.
Once the case has been submitted, you will be required to provide additional evidence and documentation to the Bankruptcy Trustee. This is where utilizing our experienced Turlock Bankruptcy Attorneys help make the process seamless and stress free. With our extensive experience in the bankruptcy code as well as with the local rules, we can make this process as easy as possible, making your experience as positive as possible. Next, generally about 21-40 days after the filing of the voluntary petition, you will be scheduled for a 341 Creditors Hearing. This is a mandatory hearing, where the Trustee will determine if you are a no-asset case or an asset case, as well as provide an opportunity for any of your creditors to attend. A no-asset case means that you either have no assets to be sold, or all your assets have been exempted from sale by the trustee. The result is a complete discharge without you losing any of your assets. In comparison, an asset case means that the Trustee will be able to sell off your non-exempt assets to pay off some or all your unsecured creditors. The Creditor’s meeting is conducted in person, however, due to the Pandemic, Trustee’s have been conducting this meeting via phone call and electronic video conferencing (i.e., Zoom).
At the conclusion of the creditors meeting, the process will continue through until you receive your final discharge. For asset cases, the Trustee will now proceed with selling off your non-exempt assets to try to pay off some or all your creditors. For a no-asset case, there is nothing that the Trustee can sell, thus you will receive your discharge and keep all your assets. This is the most common outcome for our Turlock clients, as our experienced attorneys can exempt most, if not all, of your assets. Finally, after a few months, you will receive your discharge issued by the Bankruptcy Court. Once you receive your discharge, all of your unsecured debts such as credit cards, medical bills, deficiency judgments etc., will be eliminated, and you are no longer obliged to repay them. Further, these creditors are no longer able to pursue collection or enforcement of these debts against you.
What is a Chapter 13 Bankruptcy?
A Chapter 13 Bankruptcy is characterized by its repayment plan, which allows a debtor to keep their assets while paying off some or all of their debts. For those who do not qualify under the Means Test discussed above, Chapter 13 is a common alternative for those whose incomes exceed the median household income for their household size. Further, Chapter 13 can be utilized by a debtor who qualifies for Chapter 7 but wishes to keep their property. The most common example of this is a debtor who qualifies for Chapter 7, however they are facing a foreclosure. Filing for Chapter 13 may allow the debtor to keep their home from foreclosure, while having time to repay their defaulted amount in arrears and continue to make their mortgage payments. This will stop any pending foreclosure proceeding and allow the debtor time to catch up on their arrears amount plus continue to make their regular mortgage payment.
How Long Does a Chapter 13 Bankruptcy Take?
Depending on your plan, a Chapter 13 Bankruptcy will generally take 3 to 5-years to complete. If you have completed payments for the entire duration of your plan, you will then receive a discharge from the Bankruptcy Court as long as any other requirements have been satisfied. If you fail to make your monthly payment, you risk your Chapter 13 case being dismissed, and you will not receive a discharge. For this reason, a Chapter 13 Bankruptcy requires that you have a stable income that proves to the Bankruptcy Court that you can successfully complete your monthly plan payment.
What is the Chapter 13 Plan?
To qualify for Chapter 13 in Turlock, you need a skilled and experienced attorney to complete your Repayment Plan. You must prove to the Trustee and Bankruptcy Court that you have a steady and sufficient income to cover your priority and secured debts for the Trustee to approve and accept your plan. This is done by filing a budget with the Bankruptcy Court that projects your income and expenses. It must be proven that you have sufficient income to pay your reasonable and necessary expenses, and still have money to pay your Chapter 13 Plan Payment. Your Chapter 13 Plan shows that you can pay all your priority and secured debts, such as car and mortgage payments and mortgage arrears, and then any amount of your disposable income that will be paid towards your general unsecured creditors (i.e., credit cards and medical bills). The general unsecured debts will receive anywhere from 0 to 100% of the total amount owed to them, which is at minimum the amount as they would receive if you were in a Chapter 7 Bankruptcy. A great example of how a Chapter 13 Bankruptcy can benefit a debtor who is behind on their mortgage and has other general unsecured debts, is that the Chapter 13 Plan may result in the debtor being able to catch up on their arrears amount and continue to make their regular mortgage payment, and if there have little to no disposable income, they general unsecured creditors will get little to nothing and the obligations will be discharged upon completion of the plan.
What If My Income Decreases During my Repayment Plan?
We often deal with a scenario where a Chapter 13 debtor has been successfully making their Repayment Plan payment, and now they find themselves making less. This may result from a job change, loss of job from one spouse, etc. The good news is that with the assistance of an experienced bankruptcy lawyer in Turlock, it may be possible to have your Repayment Plan modified to consider your new income. If you are unable to continue your Chapter 13 Plan, it may be possible to convert your case to Chapter 7 Bankruptcy. However, your non-exempt assets will be sold (if any) to repay your creditors under a conversion.
What Assets Can I Exempt under Chapter 7 and Chapter 13?
Regardless of if you choose to file for a Chapter 7 or a Chapter 13 Bankruptcy, you are provided certain exemptions that are prescribed under California Code of Civil Procedures Sections 703 and 704. A debtor can decide if they would like to use the exemptions afforded under Section 703 or Section 704. An experienced Turlock Bankruptcy Lawyer will be able to look at your specific situation and determine which set of exemptions will be best suited for you.
Exemptions are applied to the equity that you have in an asset. Meaning, that if you do not have an equity in a certain asset, such as your car, there is no equity that needs to be exempt. The purpose of exempting your assets in a Chapter 7 Bankruptcy is to shield or protect those assets from being liquidated and sold off by the Trustee to pay back your creditors. As experienced Attorneys, the vast majority of our Chapter 7 Bankruptcy cases are non-asset cases because we can exempt all of our client’s assets from liquidation. This results in a complete discharge while the client keeps their assets/property. For Chapter 13 cases, the purpose of exemptions is to reduce/limit the amount that you will have to pay to your creditors through your repayment plan.
Which Set of Exemptions Should I Use?
Although matters vary on a case-by-case basis, in general, those who file for a Chapter 7 Bankruptcy will utilize the 703 exemptions. The 703 exemptions are much more favorable for debtors that have equity tied up in other assets, such as multiple vehicles, bank accounts and other non-real estate assets. This set of exemption allows for a greater vehicle exemption and a Wildcard exemption, which can be used to protect any assets they choose. This system works great for those clients who either don’t own a home, or have a home with little to no equity in that home, and wants to exempt their other assets such as multiple vehicles and their bank accounts. Our experienced bankruptcy attorneys are able to maximize the 703 exemptions to help protect the assets that are most important to you.
Alternatively, the 704 exemptions are much more favorable for those who have significant equity in their home that needs to be protected from liquidation under a Chapter 7 Bankruptcy or to reduce their repayment obligations under a Chapter 13 Bankruptcy. The most significant advantage afforded by 704 exemptions is the increased homestead exemption. In September 2020, California Governor, Gavin Newsom, enacted a new regulation that changed the homestead exemption to a minimum value of $300,000.00 with a maximum exemption of $600,000.00. A debtor can exempt at minimum $300,000.00, however they can exempt a greater amount up to the maximum of $600,000.00, if the median sales price in their county from the prior year is greater than $300,000.00. This new law offers almost all of our clients the ability to get a complete discharge under Chapter 7 or a significantly reduced repayment plan under Chapter 13.
The above simply represent a small portion of the exemptions available to a debtor when choosing to file for Bankruptcy and our experienced bankruptcy lawyers will be happy to discuss these exemptions that apply to you during your free consultation.
How Do I Get Started?
If you are a Turlock resident and find yourself struggling with debt that you just can’t pull yourself out of, the first step to begin receiving the support you need to regain financial control over your life is to contact our office to schedule a free consultation with one of our experienced and recommended Bankruptcy Attorneys. Please call us at 209-314-3010 or click HERE to schedule your free consultation with high quality Turlock Bankruptcy Attorneys.
