Stockton, California - Residents of Stockton California are increasingly turning to bankruptcy attorneys to help them stop foreclosures, auto repossessions, and to eliminate medical bills and credit cards. This is because declaring bankruptcy allows individuals to legally change the terms of their loans.

Federal bankruptcy laws were created to offer debtors relief, and allow them to rebuild their credit scores and finances. In a 1934 decision, the Supreme Court defined the role of Bankruptcy as follows: “it gives the honest but unfortunate debtor a new opportunity in life and clear field for future effort, unhampered by the pressure and discouragement of pre-existing debt” - Local Loan Co. v. Hunt 292 U.S 234,244, 1934

In a nutshell, bankruptcy can mean a court order that releases a person or business from liability to a debt, and stops creditors and collection agencies from harassing them.

Different Types of Bankruptcy

According to California foreclosure lawyer Lauren Rode, “Individuals or businesses most commonly declare either Chapter 7 bankruptcy or Chapter 13 bankruptcy.” Chapter 7 works by liquidating assets in order to pay off lenders, after which the court can cancel any debts that remain. Chapter 7 is ordinarily available to individuals, families and businesses whose annual income is lower than the state’s median ($81,740 as of November 2015). If someone’s income is higher, they’ll have to apply for Chapter 13 Bankruptcy instead.

Chapter 13 allows a person to keep their assets by re-negotiating the terms of their loans. Filing chapter 13 is often used to stop foreclosure. This is because once filed, the court issues an ‘Automatic Stay’ which stops any lender from continuing with collection activities. With foreclosure rates at approximately 7% in Stockton since 2012, property owners often file Chapter 13 bankruptcy for a chance to immediately stop foreclosure and reorganize their finances.

As Ms. Rode says: “Chapter 7 is typically filed to wipe out credit card debt and medical bills, while Chapter 13 is commonly used to avoid foreclosure.”

How to File for Bankruptcy in Stockton, California

There are several steps to filing bankruptcy. First, the filing party must gather all their financial records. Next, the court calculates income to determine the type of bankruptcy they qualify for. The filing party is then obligated to attend pre-filing credit counseling. After that, the bankruptcy documents can be prepared and filed in court.

After filing, a creditor’s meeting is scheduled. Individuals or businesses filing for bankruptcy are required to appear at this meeting, and failure to do so can result in case dismissal. Creditors meetings are held at any of the California Eastern District Bankruptcy Courts.

The whole process can be quite technical and complex, which is why it’s advisable to enlist the services of a Stockton Bankruptcy Attorney or Los Angeles Bankruptcy Lawyer. With the right bankruptcy and foreclosure attorney, debt can be reduced or even eliminated. Bankruptcy attorney fees range from $1200 to $4500 in Stockton, California, depending on the type of case.

Free Bankruptcy Advice

Anyone who lives in the state of California and wishes get rid of debts can call our law firm for immediate help at 818-254-8413. Our Stockton Bankruptcy Attorneys will take the time to evaluate your case, and let you know which bankruptcy chapter is best for you.

About Consumer Action Law Group

Consumer Action Law Group is a law firm located in Los Angeles, California. Their bankruptcy lawyers have successfully stopped hundreds of foreclosures for Stockton, California residents.  Individuals who live in Stockton, California can call Consumer Action Law Group for free stop foreclosure advice. Bankruptcy Attorneys at Consumer Action Law Group have stopped foreclosures for homeowners within 5 minutes.  For a free legal advice, Call Consumer Action Law Group directly at 818-254-8413