About Bankruptcy

Your Questions Answered...

Don’t let the word “Bankruptcy” scare or intimidate you in the least. You may discover that Bankruptcy may be one of the most liberating experiences of your life. One that allows you to restore and revitalize your life with a brand new, clean slate, unencumbered by debts and stress.

Bankruptcy is simply a process, under federal law, that allows you to either eliminate or pay off your debts with a special payment plan, should you owe more money than you can afford or are able to pay.

Once your petition is filed, your creditors must stop all of their harassing collections efforts against you, as a matte of federal law.

What chapter you choose to file under, what possessions you can keep and other details are controlled by the Bankruptcy Code and the Federal Rules of Bankruptcy Procedure.

The Turoci Firm is uniquely qualified to present all the options that are available to you, to guide and assist you in choosing the option that best suits your needs at the present time.

Courthouse

Question: What is a Chapter 7 Bankruptcy?
Answer: A Chapter 7 Bankruptcy gives you protection from creditors under what is called an automatic stay. It is is a legal action which makes all your possessions or assets available to the people or companies (creditors) to whom you owe money, in exchange for eliminating your debts. A petition will be filed in federal court which lists all of your debts and all of your assets.
Question: What Can I Expect If I File Bankruptcy?
Answer: Once your petition is filed, your creditors will be notified by the court. Once they have been notified they cannot legally continue with their collection, foreclosure, repossession, wage garnishments or lawsuits against you.

Approximately five weeks after your petition is filed you will be required to attend a court hearing called the “first meeting of creditors”. The Turoci Firm will stand by your side and represent you at this meeting. The safety and security of both your possessions and emotions are of our utmost concern and our top priority.

During the hearing, a person called the “trustee”, who represents all the creditors, may ask you specific questions regarding your financial affairs. This trustee may or may not be a lawyer and there will not be a judge present in the room.

Since there is no specified amount that a person must “owe” in order to file bankruptcy, the trustee’s job is to ensure that you don’t have any additional assets or extra money that may be sold and given to your creditors to help pay off your debts.

As a general rule, you will be able to protect and keep all or most of your property including your home, car and personal possessions. As your Bankruptcy Attorney, our job is to ensure that you keep as many of your possessions and as much of your assets as the law allows.

Within one to three months after the court hearing, your final discharge will be entered with the court. Discharge also means that your bankruptcy filing has been “approved” and you are no longer required to pay the creditors to whom you previously owed money.

Once discharged, you now have a fresh, new start with your life. Draw upon your past experiences wisely and move your life forward with renewed vitality!

Question: After I File Bankruptcy Can I Still Keep My Home and Car?
Answer: You will not lose your home or car during your bankruptcy case as long as your equity in the property is fully exempt. Even if your property is not fully exempt you may still be able to keep your property by filing a chapter 13 bankruptcy instead of a chapter 7 bankruptcy. In a chapter 13 plan you will be required to pay at least the equivalent of the non-exempt equity you have in your home or car and any amount you are behind on your home or car loan over the course of a three to five year plan.  You also will be required to continue making the regular monthly payments. 
Question: Will I Loose All Of My Property and Possessions If I File Bankruptcy?
Answer: The quick answer is “probably not”. However, you must keep in mind that what possessions you can and cannot keep is determined by both state and federal law.

The good news is there are exemptions. Exemptions are dollar amounts of property that you can keep. You may also protect the part of the property which is equal to your equity. California state law determines which property is exempt.

Here is a sample of a few exemptions which are currently allowed. Please be aware this is an “example only” and may not apply to your situation.

Beautiful Home

  • Equity in real estate used as a residence (or with mobile home)
    • Up to $175,000.00
  • Tools, equipment or books of your trade
    • Up to $7,715.00
  • Household furnishings and personal property
    • $525/Item
  • Motor vehicle
    • $3,525.00
  • Jewelry
    • $7,175.00
  • Property of any kind (Wildcard)
    • Up to $23,250.00
  • Life insurance cash value
    • Unlimited
  • Pensions
    • Reasonable

In most cases you will not loose all of your possessions. More often than not you may actually keep all of your property. However, the more property you own the more likely it is that you may loose some of the property which is in excess of the allowed exemptions.

Question: What Is A Chapter 13 Wage Earners Plan?
Answer: The Chapter 13 “Wage Earners Plan” is also called “Adjustment of Debt of an Individual with Regular Income”.

It is a repayment plan, ranging from 3 to 5 years, that is available to individuals who have regular income from any source such as wages, self-employment, investments and various benefit payments.

Under Chapter 13 you make arrangements to repay all or a portion of your debts under the supervision and protection of the Bankruptcy Court. This prohibits creditors from contacting you regarding payment or collection of the debt. The creditors are forced, by the Court, to accept the plan which could last between three and five years.

When all the payments as outlined within the plan are completed you are then discharged from any liability for the remainder of the debts.

A Chapter 13 proceeding is preferred if you wish to repay all or most of your debts and you have the income with which to do so. The court will provide for the additional time needed to pay and provide for better terms of payment.

The benefit of a Chapter 13 Bankruptcy enables you, the debtor, to retain certain assets, such as your home or primary residence, which under a Chapter 7 bankruptcy might need to be liquidated.

If you are not eligible for a discharge under Chapter 7, or you have one or more substantial debts that are not dischargeable under Chapter 7, you might want to consider filing a petition under Chapter 13 of the Bankruptcy Code.

Question: What Other Types Of Bankruptcies Are Available
Answer: For more complex situations, such as individuals and businesses who have a high income, Debt Reorganization under Chapter 11 Bankruptcy may be a more preferred solution. The Chapter 11 Bankruptcy provides more time and flexibility and may be a better alternative to filing a Chapter 7 Bankruptcy.

If you’re a farmer or work within the agriculture industry, you may want to consider filing a Chapter 12 Bankruptcy. It functions similar to the Chapter 13 but has the additional benefits of the Chapter 11.

Question: Will Bankruptcy Ruin My Credit?
Answer: If you’ve gotten to the point where you’re filing bankruptcy, chances are you’ve already done some damage to your credit rating. However, the good news is most people begin to restore their credit quickly after a bankruptcy. Most lenders will be willing to do business with you again. There are laws created to “help you get back on your feet” again and allow you to enjoy a productive life and life-style without constant worry of lawsuits or embarrassment.
Question: Can I Keep Financed Property And Pay The Debt?
Answer: Yes! Even under Chapter 7 you can keep some items like a car that is financed, pay that debt and eliminate most or all of the other debts. Typically people want to keep their car or truck and a home. The legal assistance provided to you by the Turoci Firm will help you to keep these items.
Question: What Is A Debt Workout?
Answer: Debt Consolidation is a widely used term to describe debt repayment plans that allow you to get out of debt as quickly as possible. Debt negotiation and settlement is a great alternative to bankruptcy for those who want to, or are able to, pay back at least a portion of their debt. 

The Turoci Firm will work to negotiate with your creditors for a less-than-full repayment or settlement.  When settlements are reached with creditors one payment is made to the creditor and no further debt is owed.

Question: Will Filing Bankruptcy Stop Bill Collectors From Calling Me?
Answer: Yes! The automatic stay prevents all bill collectors from taking any further action to collect debts.

Question: What Documents Does The Turoci Firm Need From Me To Begin The Process?
Answer:

  • 2 Years Tax Returns
  • 6 Months Proof of Income (pay-stubs, or if self employed, a year to date Income and Expense Report and bank statements)
  • Copy of your social security card and state issued ID such as a drivers license
  • A list of all your debts (including address and account numbers)
  • A list of all your major assets
Question: Do I have Any Alternatives To Bankruptcy?
Answer: Yes! Some of your alternatives include a debt consolidation loan, debt counseling and debt work-outs.

Other alternatives to a Chapter 7 Bankruptcy include a Chapter 13 Wage Earners Plan, a chapter 11 Debt Reorganization or a Farmers Plan under Chapter 12.

WARNING

None of the above should be considered a substitute for individual legal advice and additional information is available for confidential discussion of your unique problems.

The Turoci Firm’s Assistance Can:

Help you pay significantly less than the full amount owed.

  • Help you pay off your debt faster.
  • Get you back on track financially.
  • Protect you from harassing creditor calls.

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