Author: Kostopoulos Bankruptcy Law

Facing financial difficulties can be overwhelming, especially when bankruptcy seems like the only option. However, with careful planning and proactive measures, you can avoid bankruptcy and regain control of your financial situation. In this blog post, we will provide you with nine essential tips to help you avoid bankruptcy in California.

1. Assess Your Financial Situation

The first step towards avoiding bankruptcy is to thoroughly assess your current financial situation. Take a detailed look at your income, expenses, assets, and debts. Understanding the full picture will enable you to identify areas where you can make adjustments and develop a plan to improve your financial standing.

2. Create a Realistic Budget

One of the most effective ways to avoid bankruptcy is by creating a realistic budget. Start by evaluating your income and expenses, and identify areas where you can cut back. Prioritize essential expenses such as housing, utilities, and groceries. Cut back on discretionary spending and identify areas where you can reduce costs. Consider eliminating unnecessary expenses and find ways to save money, such as cooking at home instead of eating out or canceling unused subscriptions.  By adhering to a well-defined budget, you can allocate funds toward paying off debts and building an emergency fund, ultimately preventing financial instability.

3. Increase Your Income

Boosting your income can significantly improve your financial situation and help you avoid bankruptcy. Consider taking on a part-time job, freelancing, or starting a side business. Evaluate your skills and passions to identify opportunities that align with your expertise. The extra income can be used to pay off debts faster or build an emergency fund for future financial security. Additionally, you can sell unused items or rent out a spare room to generate extra income. Every additional dollar earned can help you avoid bankruptcy.

4. Negotiate with Creditors

If you’re struggling to make payments on your debts, don’t hesitate to reach out to your creditors. Many creditors are willing to negotiate new payment terms, lower interest rates, or even settle for a reduced amount to avoid the possibility of you filing for bankruptcy. Explain your financial situation honestly and provide them with a proposed repayment plan that you can afford. Open communication can often lead to more manageable debt repayment plans.

5. Seek Credit Counseling

Credit counseling agencies can provide valuable guidance and assistance in managing your finances. They can offer personalized advice, help you create a debt management plan, and provide educational resources to improve your financial literacy. Non-profit credit counseling agencies approved by the Department of Justice’s U.S. Trustee Program can offer reliable assistance and support.

6. Explore Debt Consolidation

Debt consolidation involves combining multiple debts into a single loan with more favorable terms. This can simplify your repayment process and potentially lower your overall interest rates. Research different consolidation options, such as personal loans or balance transfer credit cards, and carefully consider the associated costs and benefits. Keep in mind that debt consolidation should be approached cautiously to avoid accumulating additional debt.

7. Explore Debt Settlement

Debt settlement involves negotiating with creditors to settle your debts for less than the full amount owed. Typically, this process begins when you are unable to make your monthly payments and have fallen significantly behind on your debts. Instead of continuing to struggle with payments or considering bankruptcy, debt settlement offers a potential solution to reduce your overall debt burden.

8. Protect Your Assets

California has specific bankruptcy exemptions that safeguard certain assets from being seized to repay debts. Familiarize yourself with these exemptions and take appropriate measures to protect your assets. Consulting with a qualified California bankruptcy attorney can provide valuable guidance on how to safeguard your property, retirement savings, and other assets within the limits of California’s exemption laws.

9. Seek Professional Financial Advice

When facing financial difficulties, seeking professional advice can be invaluable. Consult with a reputable financial advisor who specializes in debt management. They can help you analyze your financial situation, provide personalized advice, and guide you toward the best course of action. Additionally, they can offer alternatives to bankruptcy, such as debt consolidation or debt settlement.

If you are facing wage garnishment from a creditor, Kostopoulos Bankruptcy Law wants to help you learn how to put an end to the financial strain and embarrassment it might be causing. Wage garnishment means that your employer is withholding a certain amount of your paycheck and providing the funds to a creditor to whom you owe a debt. How can you stop wage garnishment in California and find relief from debt collectors?

The answer is bankruptcy. When you file for bankruptcy, collection activities are halted by what is called an automatic stay. Creditors are prohibited to continue any wage garnishment or other debt collection actions under an automatic stay. If they wish to resume, they may petition the court to lift the stay, but only if they have a valid reason for doing so. If the debt is discharged through the bankruptcy filing, creditors may not continue wage garnishment after your case has been concluded.

Important notes about wage garnishment and bankruptcy include:

• Child support or alimony payments that are being garnished from your wages are not covered under the automatic stay
• Under certain conditions, you may be able to recover wages that have already been garnished within a 90-day period before filing
• If your bankruptcy claim is dismissed and the debt for which your wages are being garnished has not been discharged, the creditor may continue with wage garnishment
• There is a chance that creditors may not be alerted of the bankruptcy filing in time to halt garnishments, so you should also alert your company’s payroll department and your local sheriff’s office

To learn more about how to stop wage garnishment in California, contact our Oakland bankruptcy lawyers at Kostopoulos Bankruptcy Law. We can discuss your legal options in a free consultation. Get started by calling us today!

Those in the military have the same right as any to file for bankruptcy relief and actually enjoy certain benefits over civilian debtors. On the other hand, filing for bankruptcy can also affect your security clearance in some situations.

Service members are offered federal protection in civil actions thanks to the Service-member’s Civil Relief Act, or SCRA. This act allows courts the right to put a stay or postpone bankruptcy and non-bankruptcy proceedings being taken against military personnel while they are on active duty. These protections are separate from the automatic stay normally provided by bankruptcies.

Exemptions from Means Testing

Normally, those looking to qualify for Chapter 7 bankruptcy need to pass a means test in order to disqualify those debtors who have enough disposable income to repay part of their debts from filing for bankruptcy. Disabled veterans, however, who have debts which were incurred mainly while on active duty, are not required to complete such a means test to qualify for Chapter 7.

Furthermore, National Guard members and reserve units of the armed forces who were called up for at least 90 days after September 11, 2001 are also excluded form a Chapter 7 means test while on active duty and for 540 days afterwards. Those who qualify must still complete the means test form no more than 14 days after the beginning of the 540-day exclusion period.

While your security clearance will not be affected automatically by filing for bankruptcy, it can factor into a decision regarding your clearance along with your job performance and relationships with superiors and coworkers.

Clearance decisions are made on a case by case basis but having a considerable amount of debt can be seen as a negative to your superiors. You should inquire into how your clearance may be affected before you even file for bankruptcy.

Kostopoulos Bankruptcy Law, our Oakland bankruptcy lawyers help clients in financial distress make important and positive decision to help manage their debt. If you are in the military currently or a veteran, speak with our firm for legal counsel!

Once you’ve made the decision to file for bankruptcy, it is common to just want to get the entire process over with. But with so many varying opinions, is there any way to know how long it actually takes? There’s no doubt that every case is different and the timeframes vary from person to person. Regardless, the following information can at least give you the barebones of what to expect from start to finish.

How Long Does Chapter 7 Bankruptcy Take?

Chapter 7 bankruptcy can take as little as three months, but may last up to six months depending on the way that you file. In a limited asset case, creditors have nothing to follow up on and everything is said and done in roughly four months. For asset-based filing, the entire process may take longer because there is more to process.

How Long Does Chapter 13 Bankruptcy Take?

Chapter 13 bankruptcy on average lasts 3-5 years. This is due to the repayment plan each individual is required to complete before your debt is discharged. However, the quicker you’re able to repay your debt, the faster you can say goodbye to bankruptcy.

How Long Will an Emergency Bankruptcy Take?

Emergency bankruptcy is exactly what it sounds like: an option for people who want an automatic stay with haste. Not everyone can file, but for those who are interested, the necessary documents must be filled out within 14 days or your case may be dismissed. It’s much quicker than either Chapter 7 or Chapter 13 and is beneficial if you need an automatic stay immediately.

Talk to an Experienced Attorney

No matter what chapter you’re hoping to file for, Kostopoulos Bankruptcy Law wants to meet your needs along the way. Get in touch with our Oakland bankruptcy attorney for representation you can count on!

If you have found yourself struggling under a mountain of debt and are unable to keep up with your financial obligations, you may be wondering whether bankruptcy is right for you. Our firm has represented clients in more than 6,000 bankruptcy filings and we have helped countless individuals in and around the San Francisco become debt free. The Debt Education and Certification Foundation (DECAF) has named us as one of the Top 100 Firms and we are one of only a few firms that has a board certified bankruptcy specialist as part of their legal team. We understand how devastating it can be to find yourself on the edge of financial ruin, with creditors harassing you non-stop, in fear that you will lose your home to foreclosure and with no viable solution in sight. During your initial consultation we will be able review your financial situation, analyze your debt and advise you as to whether you qualify to file for bankruptcy protection.

If you qualify to file for a Chapter 7 bankruptcy, you will be able to discharge the majority of your unsecured debt. Medical debt, credit card debt, personal loans, revolving lines of credit, certain student loans, auto accident claims, personally-guaranteed business debt, past due rent, and past due taxes that are more than 3 years old, are the most common types of debt discharged through Chapter 7. With this type of bankruptcy, our San Francisco bankruptcy attorney will work diligently to help maximize your exemptions to improve your chances of keeping the property and assets you value most.

There are instances in which filing for Chapter 13 bankruptcy may be a more practical option. There are also certain debts which can be discharged in Chapter 13, but not Chapter 7. These include marital debts stemming from a divorce or settlement agreement, court fees, debts resulting from loans taken from a retirement plan, HOA or Co-op fees incurred after filing for bankruptcy and more. In a Chapter 13 bankruptcy you will be required to pay priority debts such as child support, alimony and recent taxes, however other unsecured debt that will not necessarily get paid off as part of your Chapter 13 repayment plan, will be discharged upon completion of your bankruptcy proceedings. If you want to find out which of your debts may be eligible for discharge, call Kostopoulos Bankruptcy Law today.