Chula Vista Bankruptcy Lawyer
Free consultations - (619) 787-3456
Until the pandemic, the South Bay region of San Diego County was a bountiful source of employment for its residents. The tourism industry was thriving in Imperial Beach, technology and aerospace manufacturing jobs were abundant in Chula Vista, and shipyards employed thousands of workers along the waterfront.
For many workers, debt grew as they stayed home. Some jobs were lost permanently. Uninsured medical expenses have left families wondering how they will make ends meet.
The concept of filing bankruptcy frightens people, but bankruptcy laws were created to give people with unmanageable debt a fresh start. One form of bankruptcy allows partial repayment of debt under court supervision. Another form allows individuals who do not have high incomes to wipe out their debt completely.
Filing any form of bankruptcy puts an end to annoying calls from debt collectors. Bankruptcy can also delay or prevent evictions, foreclosures, and vehicle repossessions. If you live in Chula Vista, National City, Imperial Beach or elsewhere in South San Diego County, a Chula Vista Bankruptcy Attorney Michael Rehm can help you find the debt relief solution that is best for you.
How South Bay San Diego Residents Use Chapter 13 to Catch Up on Secured Debt
A Chapter 13 bankruptcy allows debtors to repay some or all of their debt. Debtors become current on delinquent car loan and mortgage payments over a period of 3 to 5 years. At the end of the plan, all unsecured debt that has not been paid is erased.
Debtors make their current mortgage and secured loan payments while the Chapter 13 plan is in effect. Foreclosures and repossessions cannot proceed as long as the debtor is in compliance with the Chapter 13 plan.
Medical and credit card bills are examples of unsecured debts that are either repaid or discharged, depending on the payments the debtor is able to make during the plan. Since the priority is to catch up on secured loan payments, unsecured creditors often receive little or nothing.
Debtors must have a regular source of income, including unemployment compensation, to take advantage of a Chapter 13 bankruptcy. Some high-income debtors are only allowed to file bankruptcy under Chapter 13.
How South Bay San Diego Residents Use Chapter 7 to Wipe Out Debt
A Chapter 7 bankruptcy erases debt. People who do not own a home or have no equity in their home often find it advantageous to file a Chapter 7 bankruptcy.
Assets owned by individuals who file under Chapter 7 can be sold by the bankruptcy trustee to pay creditors. However, the law exempts most property owned by ordinary people. For that reason, people who file under chapter 7 are usually allowed to keep all of their property that has not been used to secure a loan.
In some cases, debtors can “reaffirm” (or promise to pay) a mortgage or car loan debt. That allows the debtor to keep their secured property. That option is usually exercised by people who are not seriously delinquent and are primarily burdened by medical bills or other unsecured debt.
Advance planning maximizes the amount of property a debtor can keep in a Chapter 7 bankruptcy. Meeting with Chula Vista Bankruptcy Lawyer Michael Rehm allows debtors to begin planning for a debt-free future. For more information call (619) 787-3456 for a free consultation.
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