BANKRUPTCY UNDER THE NEW LAW

Under the new bankruptcy law that came into effect on October 17, 2005, there are several factors that will influence which chapter you will file under: Chapter 7 bankruptcy or Chapter 13 bankruptcy in San Diego.

First, according to the new law, you will need to complete an approved Financial Counseling course six months prior to the case filing.

Another one of the effects of the new bankruptcy law in San Diego is that your eligibility for filing under Chapter 7 depends on how much you earn: If your current monthly income is less than the median income in your state, you can file under Chapter 7. In case your income is greater than the median income in your state, you will have to do additional calculations. To determine whether or not you are eligible to file for Chapter 7 bankruptcy in this case, use the following equation: current monthly income, minus your expenses, multiplied by 60 (a bankruptcy lawyer in San Diego can help you do these calculations accurately). If the result is $6,000 or less, or 25% or less is unsecured debt, you will file Chapter 7. If the result is $10,000 or more, or more than 25% is unsecured debt, you must file under Chapter 13, as one of the alternatives to Chapter 7 bankruptcy in San Diego.

The new bankruptcy law also requires you to take an approved Credit Education Course. This must be completed and filed with the Court within 45 days after your 341(a) hearing in order to receive a discharge.

Under which chapter should you file? Chapter 7? ...Or Chapter 13? To get advice from a professional, or to find more information regarding the effects of the new bankruptcy law in San Diego, contact a attorney, Mark A. Reed. (858) 277-0232 today. We are a debt relief agency.