By the start of spring, 1 million Californians had already filed for unemployment. As of mid-April, this number almost tripled to 2,824,438. Needless to say, many Californians are worried about their abilities to meet financial obligations without falling into serious debt. People who are already in debt might now wonder how to find their way out. Whether your debt problems started in the past few months or several years ago, bankruptcy Anaheim, California, options can help.
The details of the process for filing bankruptcy differ based on the type of bankruptcy you qualify for or choose to file. Even so, there are some general procedures you might follow regardless of which option you choose.
Before you make any decisions regarding bankruptcy, it’s important to consider all the facts. To do this, you need to collect all the documentation you have regarding your financial situation. If professionals handle your financial information, reach out to them for copies of your documents.
You can also get a lot of this information from the mail you kept or via company websites. Look for documents that provide the following:
- Income verification, such as tax returns and paystubs
- Proof of expenses, such as utility bills and rent receipts
- Account statements for debts owed, such as credit card statements
- Asset information, such as statements for 401(k)s and investments
Bankruptcy might immediately come to mind when you realize you are struggling to make ends meet. However, there might be other options available to you that are worth exploring. For some people, cutting back on expenses resolves their financial problems. Selling some assets is another option.
In other instances, people turn to either debt consolidation or debt settlement. Debt consolidation often works best for people who still have great credit, while debt settlement suits people who do not. Consult a professional to learn if either of these may work for you.
If you decide to proceed with bankruptcy, there are three main options available to you from which you might need to choose. Here is some basic information to help you decide which is best for you:
- Chapter 7: Also known as liquidation bankruptcy, this is the most common option. Note that some assets are exempt and might get spared from the liquidation process.
- Chapter 13: Commonly called the reorganizational plan, this might help you create a repayment plan to keep your property while making payments for 3-5 years.
- Chapter 11: This is similar to Chapter 13 but is created for people with a higher-than-normal debt load and for businesses.
Before filing for bankruptcy in California, there is a mandatory counseling course you need to complete. Ensure that you choose a course from a reputable and approved organization. The course is usually not free, but it is not expensive.
Professionals advise that anything more than $50 should prompt some shopping around. Approved nonprofits might provide courses for as low as $18.