Considering Bankruptcy Claims in California? Here are some of the things you should know.
Having debts working against you could be one of the most stressing periods of your life, especially with creditors coming after your property. In such situations, you may be considering bankruptcy as an option to protect your property from creditors seeking to recollect their debts. The process may be easy if you have had prior experience before. However, the process might pose a challenge for someone unfamiliar with the procedure.
One of the most common questions that people ask themselves when considering bankruptcy as a step to ease the pressure of creditors is the minimum debt amount required to file for bankruptcy.
The laws in California do not specify the minimum debt required for eligibility to file for bankruptcy. Thus, you would be allowed to file for bankruptcy relief in the state notwithstanding the amount of debt that you owe your creditors.
The decision to proceed with the bankruptcy claim would entirely depend on your circumstances. Even without a minimum debt; however, the courts in California are likely to take into consideration these circumstances in deciding whether to award or reject the bankruptcy claim.
Some of the essential factors evaluated in the decision to grant or deny the bankruptcy claim include your ability to repay the debts and the possibility of your creditors agreeing to work with you. The courts will also be interested to know if you would be able to discharge your debts if granted bankruptcy.
On your part, you should make efforts to speak with your bankruptcy attorney to find out the options available to you before deciding to file for bankruptcy.
Another essential point to note is that despite there being no minimum limit for eligibility to file for Bankruptcy under California laws, the state has in place a maximum amount allowed for one to be eligible. This, however, is dependent on the type of bankruptcy you are filing for.
To be eligible for a Chapter 13 bankruptcy, for instance, your debts should not exceed $1,257,850 in secured debts, and a maximum of $419,275 unsecured debts. In addition to these limits, the State of California has in place restrictions on the number of times you can receive a discharge. Thus it would be a good idea to go through all these factors with your attorney before deciding to proceed to file for bankruptcy.