Susan runs a dance studio in Los Angeles but due to the recent economic decline she has had far fewer clients. Susan could no longer afford to pay for her expenses and her credit card bills are piling up. While most of the debt was in the name of her dance studio, which is a corporation, they were personally secured by her. Therefore, if she had the corporation file for bankruptcy she would still be responsible for the debt. Susan has reached her breaking point as there is only 1 week until her house is put up for sale by her lender. Susan found a Bankruptcy attorney in Los Angeles near her studio.

Generally, filing for bankruptcy stops all of your creditors from collecting even before the bankruptcy is granted. Once a bankruptcy petition is filed, any garnishment of wages, levies on bank accounts and lawsuits stop. Even if a bankruptcy is filed 1 minute before the sale of your home and it is sold anyway, the transaction can be reversed and you will continue to own your home. However the best course of action is to avoid this hassle and contact a bankruptcy attorney before this happens.

Creditors take notice once there is a stay and may be more willing to negotiate. This may be helpful on secured debts such as a mortgage but not as much with unsecured debts like credit cards. Negotiating with credit card bills may be a trap for the unprepared, as the reduction in the amount you owe turns into income you must pay taxes on. In addition, you may find that not all of your creditors will be willing to negotiate and you will in the end still file for bankruptcy but only after paying more money to creditors than you would have otherwise.

A chapter 7 bankruptcy allows all of your unsecured debts like credit cards to be discharged. A chapter 13 allows you to keep more of your property (i.e., home in foreclosure, automobile, etc…) and puts the debts on a 3-5 year payment plan based on the amount of excess income after paying expenses, but the amount of unsecured debt cannot exceed 300,000.

Susan’s attorney felt that a chapter 7 bankruptcy was the right choice because although the mortgage on her home in Los Angeles was upside down her unsecured debt was too high for a chapter 13 and her current income did not exceed her expenses. Susan’s attorney helped her through the process of a chapter 7 bankruptcy.

Susan now had a fresh start and was able to keep living in her home and running her dance studio. While many believe bankruptcy eliminates any future ability to get credit Susan was able to get new credit cards shortly after receiving her discharge

Bankruptcy Attorney in Los Angeles | Bankruptcy Attorneys in Los Angeles

Bankruptcy Lawyer in Los Angeles | Bankruptcy Lawyers in Los Angeles

Tags: Bankruptcy, Bankruptcy Attorney, Bankruptcy Attorney In Los Angeles, bankruptcy attorneys, Chapter 13, Chapter 7, Credit Card, Debt, los angeles bankruptcy attorney