Garnishments | Law Office of Peter Cianchetta

CHAPTER 7

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CHAPTER 13

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Sometimes life does not work out the way you intend. When that happens there is a chance to get a “Fresh Start” through Bankruptcy. The Law Office of Peter Cianchetta is here to help you.

If you are at a financial crossroad, let the friendly staff at the Law Office of Peter Cianchetta help you with the decision of which path is best for you. If you are facing Foreclosure, Repossession, Seizure of Assets, Wage Garnishments, Collector Calls, Law Suits or other financial crisis call today for your free consultation and case analysis.

You may have ask yourself “Is Bankruptcy is right for me?” Every individual situation is different. If you cannot pay all of your bills, collectors are calling you constantly, you are about to lose your home, car or other asset, bankruptcy may be right for you. We will sit down and discuss your situation and evaluate if bankruptcy is right for you at no cost. Call today for a free appointment to speak with an attorney today.

Have your wages been garnished?

Has your bank account been levied?

Have you been sued for a debt?

Do you owe more than you can pay?

If you answered yes to any of these questions call now for a free appointment with an attorney to evaluate your situation.

CALL NOW FOR YOUR FREE APPOINTMENT

WITH YOUR ATTORNEY… NOW!

916.685.7878

8830 Elk Grove Blvd.

Elk Grove, CA 95624

Serving all of Sacramento County, Placer County, Sutter County Yolo County, Yuba County, El Dorado County; incluiding the cities of Davis, Folsom, Elk Grove, Citrus Heights, Rancho Cordova, Gold River, Natomas, Arden, Land Park, Greenhaven, Pocket, Antelope, Rosemont, Carmichael, West Sacramento, Rio Linda, Orangevale, Fair Oaks, Laguna, Roseville, Rocklin and Marysville.

Debt Relief Agency

IMPORTANT INFORMATION ABOUT

BANKRUPTCY ASSISTANCE SERVICES FROM AN ATTORNEY

OR BANKRUPTCY PETITION PREPARER.

If you decide to seek bankruptcy relief, you can represent yourself, you can hire an attorney to represent you, or you can get help in some localities from a bankruptcy petition preparer who is not an attorney. THE LAW REQUIRES AN ATTORNEY OR BANKRUPTCY PETITION PREPARER TO GIVE YOU A WRITTEN CONTRACT SPECIFYING WHAT THE ATTORNEY OR BANKRUPTCY PETITION PREPARER WILL DO FOR YOU AND HOW MUCH IT WILL COST. Ask to see the contract before you hire anyone.

The following information helps you understand what must be done in a routine bankruptcy case to help you evaluate how much service you need. Although bankruptcy can be complex, many cases are routine.

Before filing a bankruptcy case, either you or your attorney should analyze your eligibility for different forms of debt relief available under the Bankruptcy Code and which form of relief is most likely to be beneficial for you. Be sure you understand the relief you can obtain and its limitations. To file a bankruptcy case, documents called a Petition, Schedules and Statement of Financial Affairs, as well as in some cases a Statement of Intention need to be prepared correctly and filed with the bankruptcy court. You will have to pay a filing fee to the bankruptcy court. Once your case starts, you will have to attend the required first meeting of creditors where you may be questioned by a court official called a `trustee’ and by creditors.

If you choose to file a Chapter 7 case, you may be asked by a creditor to reaffirm a debt. You may want help deciding whether to do so. A creditor is not permitted to coerce you into reaffirming your debts.

If you choose to file a Chapter 13 case in which you repay your creditors what you can afford over 3 to 5 years, you may also want help with preparing your Chapter 13 plan and with the confirmation hearing on your plan which will be before a bankruptcy judge.

If you select another type of relief under the Bankruptcy Code other than Chapter 7 or Chapter 13, you will want to find out what should be done from someone familiar with that type of relief.

Your bankruptcy case may also involve litigation. You are generally permitted to represent yourself in litigation in bankruptcy court, but only attorneys, not bankruptcy petition preparers, can give you legal advice.

Discharging a Second Mortgage is possible in a Chapter 13 Bankruptcy. When the value of a home is less than the senior encumbrances, the bankruptcy court may find that a secured loan is unsecured and treat it as a wholly unsecured loan, and discharge the junior secured loan (commonly called a “lien-strip”).

For example, a home has a First Deed of Trust and a Second Deed of Trust. This is very common in the California housing market. Many homes were purchased with two loans the first for 80% of the purchase price and the second for the remaining 20% of the purchase price. This allowed the first loan to be a conforming loan and qualify for better terms. For this example we will assume the home was purchased for $300,000. The first deed of trust was $240,000 and the second was for $60,000. The current Fair Market Value (FMV) is $225,000. The remaining balance on the First Deed of Trust is $235,000 and the remaining balance on the second is $59,000. In a chapter 13 bankruptcy, the debtor files a Motion to Value the Collateral of the Second Deed of Trust. The Bankruptcy Court would find the collateral securing the Second Deed of Trust is $0.00 because the Senior lien, the second Deed of Trust is greater than the FMV of the property, and therefore the value of the collateral of the Second Deed of Trust is Zero. The court would calculate the value of the collateral of the Second Deed of Trust by subtracting the balance of the senior Lien from the FMV which results in a negative number. ($225,000 – $247,000 = $22,000)

The Bankruptcy Court is separated into several districts. Each Bankruptcy Court falls under a Federal District Court. In Sacramento, the Bankruptcy Court is the Eastern District of California, which is in the Federal Ninth District. The Ninth District decided a case titled In Re Lam. Lam held that a lien-strip was possible without an Adversarial Proceeding, and could be accomplished with a noticed motion. The Eastern District allows the lien-strip motion to be included in the original Chapter 13 Plan if properly noticed it will not require a separate noticed motion to accomplish. The motion is granted if there is not opposition filed to oppose the motion and confirmation of the plan.

In the current market where home values continue to decline, a potential bankruptcy debtor should consider filing a Chapter 13 if lien-stripping would make keeping their home feasible given their circumstances.

Filing Bankruptcy in Sacramento or any other Court is a complicated process. Debtors should seek competent legal advice from a qualified bankruptcy attorney before attempting to file on their own. Often Sacramento bankruptcy attorneys will allow some of the attorney fees to be paid through the chapter 13 plan. The Law Office of Peter Cianchetta makes arrangements to pay some or all of the attorney fees to be paid though the Chapter 13 plan.

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PERSONAL BANKRUPTCY