Debt can be crippling. Many in Sacramento are living with debt. And the situation is worsening. But how do you get out of debt? This recent news story offers tips to relieve your debt dilemma. But the options offered presume you have the money to, at minimum, pay down your debt. What do you do when you don't have the income to do that?

Bankruptcy is an option when you cannot afford the debt you have. Filing bankruptcy allows you to discharge your debt. This means your debt can be eliminated. Typically people who file bankruptcy can retain their property and still get out of debt. There is often nothing to lose. Credit is impacted by filing bankruptcy, but so is debt itself. That's where bankruptcy comes in.

When you have too much debt, something needs to be done. If you don't have the money or resources to get out of debt, the problem can only worsen. Bankruptcy is a way to get out of debt. Bankruptcy offers credit relief to those who cannot afford their debt. If you can pay your debt, even if only a portion of it, bankruptcy law requires you do so. For those who can't pay their debt, a bankruptcy discharge is often the best solution.

Though bankruptcy impacts your credit negatively, the elimination of debt is helps it. If the elimination of your debt is more beneficial than a bankruptcy filing is negative, bankruptcy should be considered. Filing bankruptcy is better done sooner than later. That's because living in debt often is worsened by going further in debt to relieve your other debt. It is a nasty spiral, and it can't be sustained.

If you are living in more debt than you can pay, I invite you to contact my office for a free consultation to evaluate your options. 

Bankruptcy refiling is a common question potential clients ask. Can you refile a bankruptcy they ask. Yes, you can refile a bankruptcy. But the effect of a subsequent bankruptcy filing varies depending on how long it has been since you last filed bankruptcy. It also depends on how the prior bankruptcy concluded. Was the prior bankruptcy case concluded successfully? Did it result in a bankruptcy discharge, or was it dismissed. When a bankruptcy case is completed, and all goes well, the result is a discharge. A bankruptcy discharge eliminates your debt. With a Chapter 7 bankruptcy normally all your debt is discharged. In a Chapter 13 bankruptcy you commonly pay a portion of your debt, and then discharge what you cannot afford to pay. But if a case is dismissed, a discharge is not ordered by the bankruptcy court.

Refiling after a prior case was dismissed is common, and can usually be filed right after the prior case is dismissed. A bankruptcy refiling after the previous case was discharged may result in another discharge, or it may not. It depends how long between the bankruptcy filings.

If it has been 8 years since your last case was filed, all bankruptcy options should be available again. If more more than 4 years but less than 8, you can file a Chapter 13 bankruptcy and discharge what you can't afford to pay; but you will need to pay something in that situation, even if only 1% of your debt. Less than 4 years you normally do not get a discharge. But you can refile a bankruptcy and get bankruptcy protection, provided you repay all your debt. This is a common scenario for those facing a home foreclosure. If their home is being foreclosed and they filed bankruptcy resulting in a discharge the last 4 years, they can still stop the foreclosure process with a bankruptcy filing. But they would have to pay back their debt owed on the house and other debts.

Though bankruptcy refiling can be an option, it can come at a cost. If you file bankruptcy and have had a prior case pending in the prior year, you only get 30 days of bankruptcy protection. You have to ask the court for more if you need it. Two prior cases in the past year is even worse. You get no bankruptcy protection under that circumstance. You have to ask the judge to order it to get it. There are restrictions and technical rules to it all. Best if you don't have to refile. But it is nice to know you can if you have to.

Contact me for a free consultation if you have any questions concerning bankruptcy refiling. It is a very technical area of bankruptcy law that is best not done without professional advice. The Sacramento Bankruptcy Court is another good option for information you may need. 

 Bankruptcy obligations are many. But so are the benefits. Some of the most basic requirements are to disclose all your debts. The same goes for all your assets. Listing your debts is obvious. The purpose of filing for bankruptcy is debt relief. Listing your debts in your bankruptcy paperwork is a given. It is how your creditors are notified of your bankruptcy filing.

But just as important is listing your assets. Bankruptcy obligations require you disclose all your assets. This includes all of your property. And I mean all of it! If you don't list all your stuff, you might not be able to keep it. Even worse, you may not be entitled to bankruptcy benefits. Intentionally concealing your property may land you in legal trouble. Big legal trouble. This news story depicts the story of a doctor who hid her assets from bankruptcy. Bad idea. Don't do it is the lesson.

Bankruptcy law allows you to retain your possessions. Normally for consumers filing bankruptcy, this includes all their property. But bankruptcy obligations require you disclose all your assets, even if you have more property than you are allowed to keep. "Lending" property to a relative or "forgetting" a car accident claim are bad ideas before filing for bankruptcy. Be honest. You have to be. Filing bankruptcy is done under penalty of perjury. You are swearing to tell the truth just by signing your bankruptcy paperwork.

As I have told clients over the years, take care of the bankruptcy and the bankruptcy will take care of you. Amongst the most important bankruptcy obligations is to be truthful. Bankruptcy is a powerful legal tool. It can afford filers many benefits. Your debt can be eliminated or diminished with only your signature. Make sure, though, you are signing off on the truth.