If you need help with a Bankruptcy case, please contact Armen Sefyan at (661) 418-2426 for a free consultation.

We offer the expertise and adaptability to meet each client’s unique bankruptcy situation. We offer the personal care of a specialized boutique firm, along with a strong foundation in tax and real estate law that intersects with the bankruptcy process. Sefyan Law Offices understands there is no ‘one-size-fits-all’ approach for processing a bankruptcy. We offer a range of legal services and experience in the areas of bankruptcy, including Chapter 7 bankruptcy and Chapter 13 bankruptcy, while providing a custom-tailored approach during each step of the filing and litigation process.

Always aware of the sensitivity of the bankruptcy process, Sefyan Law Offices safeguards clients from unnecessary exposure and helps resolve financial difficulties in a timely manner. If you are considering filing for bankruptcy, please contact our office for an initial consultation, to better understand your options and make an informed decision.

We are a debt relief agency. We help people file for relief under the Bankruptcy Code.

Chapter 7

Chapter 7 bankruptcy provides individuals with relief from high credit card debt and other unsecured debt. If you are submerged in debt, or if your wages are being garnished by a creditor, filing for Chapter 7 will stop creditors from a majority of their collection efforts and protect some your assets. If you qualify for filing Chapter 7, the Bankruptcy Court will allow you to maintain some of your assets during a liquidation process that leads to a discharge of most of your debt.

If you feel as though you require protection from creditors and require immediate relief from mounting debt, we recommend a one-on-one consultation with an attorney at the Sefyan Law Offices.

If you need help with a Bankruptcy case, please contact Armen Sefyan at (661) 418-2426 for a free consultation.

1. I’ve Heard There’s a New Law That Will Make Filing Bankruptcy More Difficult. Is That True?

Yes. It is called the Bankruptcy Abuse Prevention and Consumer Protection Act and President Bush signed it in April 2005. The key to the new legislation is the so-called “means test,” which will determine whether potential Chapter 7 filers could afford to pay back their creditors under a Chapter 13 schedule. The problem is, the test will disqualify from Chapter 7 filing anyone whose income is higher than the median for the state (as determined by the IRS and Bureau of Labor Statistics) and who can afford to pay at least $6,000 or 25% of their unsecured debt (whichever is greater) over five years. This will affect many middle-income individuals or families who earn above their state’s median, but are forced into bankruptcy after accruing large debts, often because of divorce or medical emergencies. For details on the new bankruptcy rules, see our story.

The new law, which had been pushed for eight years by banks and credit card companies and was fiercely opposed by consumer advocates and bankruptcy attorneys, will go into effect in October 2005. Until then, the old rules — explained in the answers below — apply.

2. What’s the Difference Between Chapter 7 and Chapter 13 Bankruptcy?

If you file for Chapter 7 bankruptcy, most of your unsecured debts are written off within 90 days of filing. The bankruptcy will then stay on your credit report for 10 years. While debts will be forgiven, you may also have to give up some of your property, which may be sold, the proceeds of which will be distributed among your creditors. In most cases, this means you may lose your house (if you own it), as well as any expensive items such as art and jewelry, and pricey consumer electronics.

Chapter 13, on the other hand, is a repayment plan: You set up a three- or five-year schedule with your creditors. Chapter 13 bankruptcy remains on your credit report for seven years. With this type of bankruptcy, you get to keep all of your property, including your home, but need to show that your income will be enough to live on while you’re still paying down debts.

3. Is Chapter 7 Bankruptcy Right for Me?

You may be a candidate for Chapter 7 if after you pay for your basic monthly expenses you have no money left to pay off debts. Chapter 7 essentially wipes the slate clean, but you’d most likely lose any valuable possessions., a bankruptcy information Web site, has a detailed list of exemptions by state.

4. When Does Chapter 13 Make Sense?

Chapter 13 is typically recommended for debtors who’ve fallen behind on their payments because of a temporary problem (such as a job loss), but can get back on track if given more time to catch up. After filing Chapter 13, a repayment schedule is established that eliminates all interest payments as part of the deal.

5. Under Chapter 7, Are There Any Restrictions on the Kind of Debts That Can Be Discharged?

Yes. Child-support and alimony payments, for example, are never dischargeable. Neither are past tax bills, even if paid by credit card. Student loans can be forgiven in very rare situations.

Creditors also have the right to object to the discharge of certain unsecured debts, such as large purchases or cash advances made within 60 days of filing.

6. Can I Choose Not to Discharge Certain Debts in Chapter 7, Like a Car Loan or Mortgage?

That depends on how much equity you already have in those properties. Theoretically, you can keep a debt obligation after bankruptcy by signing a reaffirmation agreement with your creditor. With such an agreement, you’re basically stating that you’ll continue to make payments on the debt, even after all your other debts are written off. So, for example, if a Chapter 7 filer wanted to keep a car, he would sign a reaffirmation agreement with his auto lender and continue to make the car payments during and after his bankruptcy.

7. What Happens to My Credit After Bankruptcy?

The most obvious thing that happens when you file for bankruptcy is that you get a notation on your credit report. Your credit score, which is the number creditors use evaluate your credit-worthiness, will also take a hit. © 2007 SmartMoney. SmartMoney is a joint publishing venture of Dow Jones & Company, Inc. and Hearst SM Partnership. SmartMoney is a registered trademark. All Rights Reserved.
The information provided is obtained from independent third-party sources that are not affiliated with Sefyan Law Offices, PC and that are deemed to be reliable. The accuracy or completeness of this information is not guaranteed nor does Sefyan Law Offices, PC, make any warranties to you regarding the results obtained from its use. The information should not be deemed an offer or solicitation by Key or any of its affiliates with respect to the sale or purchase of any securities, nor shall it be considered investment or other advice.