Filing Chapter 13 After Chapter 7 in Sacramento, CA

If you’re in a financial hardship and are filing for Chapter 7 bankruptcy in Sacramento, CA, the idea of filing a subsequent Chapter 13 bankruptcy can seem daunting. While the law does not categorically rule out the possibility of filing for Chapter 13 bankruptcy after a recent Chapter 7 case, it does come with its own complexities and rules. Here, we at Liviakis Law Firm have put together a comprehensive guide on the subject to provide insights for individuals in Sacramento, CA.

Understanding Bankruptcy Cases

Firstly, it’s crucial to understand bankruptcy filings. Chapter 7 bankruptcy, often termed ‘liquidation bankruptcy’, allows for the discharge of several unsecured debts after non-exempt assets have been liquidated by the trustee. However, it might not absolve all debt, such as student loans, tax liabilities, or alimony payments. Chapter 13 bankruptcy, on the other hand, is a ‘reorganization bankruptcy’. It enables individuals with regular income to formulate a plan to repay all or part of their debts through a trustee over a period of three to five years.

Why Chapter 13 After Chapter 7?

Often referred to as ‘Chapter 20’, a strategy to file for Chapter 13 bankruptcy after Chapter 7 can be useful under certain circumstances. The main reason is when the Chapter 7 bankruptcy has not discharged all due debts. Or, it might be beneficial if a debtor has significant assets that they want to keep, which would otherwise be liquidated in a Chapter 7 scenario.

Rules and Restrictions

The Bankruptcy Code provides guidelines regarding sequential filings. To receive a discharge in the Chapter 13 case after a Chapter 7, there must be at least a four-year gap between the two filings. However, even if the four-year mark hasn’t been reached, debtors can still file a Chapter 13 bankruptcy for the sake of repayment plan benefits, even though they won’t receive a discharge of debt.

The Role of the Local Sacramento Court

Bankruptcy cases, even subsequent filings, are not automatically denied. The courts in Sacramento, CA, together with the appointed trustee, evaluate each case’s merits. They assess whether the filing is abusive or unfair to creditors, considering income, expenses, and debt type for Chapter 13 eligibility.

Importance of Legal Assistance

Filing for Chapter 13 after a recent Chapter 7 case can be a complex process, and legal guidance is invaluable. At Liviakis Law Firm, we understand the ins and outs of bankruptcy laws and can help you navigate this complicated terrain. Our comprehensive legal strategy aims at assisting clients in managing their debts and piecing together their financial lives.

For any queries or to schedule a free consultation, call Liviakis Law Firm at 916 459 2364. We bridge the gap between your financial challenges and a fresh financial start.

Note: This article offers general advice and may not consider every aspect of your specific circumstances. For personalized advice, contact a qualified professional.

Mik Liviakis, Attorney at Law