If you are financially struggling and dealing with debt problems, you might want to consider filing for bankruptcy. An unemployed citizen in California may opt to file bankruptcy, which will help him or her have a fresh start by eliminating or reducing certain debts owed. Bankruptcy exemptions can also enable a bankrupt individual to save his or her personal property and stop foreclosure or wage garnishment.

Job loss or unemployment can be a crucial deciding factor if you want to be eligible to file a petition in bankruptcy. This could give you a higher chance of qualifying for certain bankruptcy proceedings. However, this may also prevent you from exploring other bankruptcy options. Seeking legal help and assistance from an experienced bankruptcy attorney will enable you to understand relevant bankruptcy laws and the specifics of different bankruptcy proceedings, especially if the filer is unemployed. Such will also be beneficial to avoid legal issues throughout the lengthy bankruptcy process.

There are a lot of individuals who struggle to repay mortgage payments, credit card bills, and other expenditures due to a lack of sufficient monthly income. Filing a bankruptcy petition could be a possible option if you are overwhelmed with debt and are experiencing distress due to unemployment.

Bankruptcy FilingThere are different types of bankruptcy cases. Common bankruptcies would likely be either liquidation (under Chapter 7) or reorganization (under Chapter 13). Deciding which bankruptcy chapter would be best for you will depend on your monthly income, living expenses, and priorities. The types of debt you owe, whether they are mostly unsecured debt or mostly secured debt, would also factor into the bankruptcy case you will file. Passing the bankruptcy means test is also crucial if you want to be able to file a petition for bankruptcy under specific chapters.

The bankruptcy means test measures your financial capacity to pay all (or most of) your debts to creditors. If your monthly income falls below the income of an average household in California (median income), you may be able to file for bankruptcy. Bankruptcy lawyers will help you decide the best time to file a petition and if liquidation of assets is indeed most suited for your situation.

While there are several bankruptcy forms, most bankruptcy cases fall under Chapter 7 and Chapter 13. Both can offer debt relief, albeit through radically different financial approaches. Unemployment can be key when filing Chapter 7 but a disadvantage when filing Chapter 13.

You are not required to have a job if you want to file for bankruptcy Chapter 7. In fact, since the means test is a vital part of the bankruptcy procedure, unemployment can potentially help you file for bankruptcy under this chapter. Legally speaking, you are also not required to have a job when filing Bankruptcy Chapter 13. However, it may become an obstacle and theoretically prohibit you from completing your would-be repayment plan. 

The objective of a bankruptcy court-approved payment plan is to restructure finances and propose a payment arrangement between the debtor and any creditor concerned. The debt repayment plan would depend on the financial condition of the filer and would usually take up to three or five years. The payment plan organizes debts based on their value. This ensures that priority loans (such as child support and alimony) and certain collateral loans (like car loans) are repaid first.

For a debtor to remain constantly current with the payment plan (which usually calls for monthly payments), he or she must have enough disposable income. This is where job loss can become a major concern. If the bankruptcy court finds that your disposable income is insufficient to effectively manage a repayment plan, you will be advised to file under Chapter 7 instead. However, if you can show that you have a sufficient amount of income from sources other than work (such as your savings or social security payments), you may be able to file a Chapter 13 even if you are unemployed.

Unemployment does not stop you from declaring bankruptcy. If you do not have a job and need support to wipe out your debts, filing personal bankruptcy remains a feasible strategy.

Get the services of a reliable bankruptcy lawyer. For legal help and assistance, contact Law Office of Daniela Romero for a free consultation on bankruptcy filings.