Bankruptcy Attorney in Modesto, CA
Facing overwhelming debt can be one of the most stressful and uncertain experiences in life. At Scott Mitchell Law, we help individuals and families in Modesto, CA, find financial relief through the legal process of bankruptcy. Whether you are struggling with credit card debt, medical bills, wage garnishments, or foreclosure, our firm provides experienced legal guidance to help you regain control of your finances and move toward a fresh start.
Understanding Bankruptcy
Bankruptcy is a legal process designed to help individuals and businesses eliminate or restructure debt under the protection of federal bankruptcy laws. It can provide immediate relief through an automatic stay, which stops most collection efforts, including lawsuits, foreclosures, and harassing creditor calls. There are different types of bankruptcy, and the best option depends on your unique financial situation and goals.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy, also known as liquidation bankruptcy, is the most common form of consumer bankruptcy. It allows eligible individuals to discharge most unsecured debts, such as credit card balances, medical bills, and personal loans. In a Chapter 7 case, a bankruptcy trustee may sell non-exempt assets to repay creditors, although most people are able to keep all or most of their property through exemptions.
To qualify for Chapter 7, you must pass the means test, which compares your income to the median income for a household of your size in California. If you qualify, Chapter 7 can provide fast and effective debt relief, typically within a few months.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy is a reorganization plan that allows individuals with regular income to repay a portion of their debts over a period of three to five years. It is often used by people who do not qualify for Chapter 7 or who want to protect assets such as a home from foreclosure or a vehicle from repossession.
Under a Chapter 13 plan, you make monthly payments to a bankruptcy trustee, who distributes funds to creditors according to the terms of your court-approved plan. At the end of the repayment period, any remaining eligible debt may be discharged. Chapter 13 offers a valuable path for those who want to catch up on missed payments while keeping their assets.
Stopping Foreclosure and Repossession
Bankruptcy can be an effective tool for stopping foreclosure on your home or preventing vehicle repossession. The automatic stay puts a halt to creditor actions, giving you time to work out a solution. In Chapter 13, you may be able to catch up on past-due mortgage or car payments and keep your property.
Rebuilding After Bankruptcy
While bankruptcy can affect your credit, it also provides a clean slate to rebuild your financial future. Many people begin improving their credit shortly after their case is resolved. Our firm offers guidance on rebuilding credit, managing finances, and avoiding future financial hardship.