Category: Bankruptcy

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.

If you are wondering whether bankruptcy may be right for you, we advise you discuss the matter with a certified bankruptcy specialist. Kostopoulos Bankruptcy Law is one of only a few San Francisco law firms that have a bankruptcy specialist on their legal team who has been certified by the American Board of Certification. Having represented clients in more than 6,000 bankruptcy cases, we have the expertise necessary to answer your bankruptcy-related questions and help you navigate through the bankruptcy process.

Continue reading “The Most Common Reasons to File for Bankruptcy California Bankruptcy”

What Is the Bankruptcy Means Test Used For?

Section 707(b)(2) of the Bankruptcy Code applies what is called a “means test” to determine whether a debtor’s filing of a Chapter 7 would be presumed an abuse of the Bankruptcy Code, thereby requiring a conversion of the case to a Chapter 13.

Essentially, the “means test” was created to determine whether a debtor’s income is low enough to qualify for a Chapter 7 bankruptcy. This formula was designed to keep debtors with higher incomes from filing a Chapter 7 bankruptcy. High income debtors who fail the means test must file a Chapter 13 bankruptcy, which allows them to repay a portion of debts over a period of 3 to 5 years, but they may not use the Chapter 7 to wipe out their unsecured debts altogether.

How to Pass the Means Test

Passing the means test does not mean that you have to be penniless to qualify for a Chapter 7. You can earn a significant amount of income and still pass the means test providing you have a lot of expenses.

Some expenses that might help you pass the means test can include:

• Large mortgage payment
• Large car payments
• Tax obligations
• Court-ordered payments such as alimony or child support
• Out-of-pocket healthcare expenses
• Care for disabled, ill or elderly household members
• Other expenses incurred due to special circumstances

The means test was specifically designed to limit the use of the Chapter 7 bankruptcy to those individuals who truly cannot afford to repay their debts. The means test deducts specific monthly expenses from the debtor’s current monthly income (the debtor’s average income over the six months prior to filing for bankruptcy) to arrive at the debtor’s disposable income. The more disposable income, the less likely the debtor will qualify for a Chapter 7.

Can Business Debts Be Used?

The means test only applies to bankruptcy filers with primarily consumer debts and not business debts. When taking the means test, your Oakland bankruptcy attorney will first determine whether your income is above or below the median income of the state of California.

If your current monthly income is less than the median income for a household of your size in California, you automatically pass and you’re done and you can file a Chapter 7. However, if your median income is higher than the threshold, your attorney will have to determine if you have enough left over to repay some of your debt.

Find Out Your Eligibility

At Kostopoulos Bankruptcy Law, we can help you apply the bankruptcy means test in order to determine if you qualify for a Chapter 7 bankruptcy. Our founder, attorney Rita Kostopoulos is a certified consumer bankruptcy specialist by the American Board of Certification and our firm was named among the Top 100 Firms by Debt Education and Certification Foundation (DECAF). We can sit down with you and determine if bankruptcy is right for you and if so, which Chapter you qualify for.

Read our Client Testimonials page to see what our clients are saying about our services!

Are you facing a financial hardship? Do you feel overwhelmed by debt? If so, working with Kostopoulos Law Group — Kostopoulos Bankruptcy Law can help! Our team is comprised of caring, experienced and understanding legal professionals who stand ready to ensure that you receive a favorable outcome for your case. We have 10 years of experience handling a variety of bankruptcy-related issues and we may be able to help you as well. If you have been contemplating bankruptcy, we encourage you to work with our team!

Recently, we launched our new user-friendly website, and to correspond with the site, we proudly announce the launch of this new blog. This blog will be updated periodically to provide information and up-to-date content for Oakland residents regarding bankruptcy and our own case results. Check back soon, and in the meantime, contact Kostopoulos Law Group — Kostopoulos Bankruptcy Law and tell us your story. We may be able to help!