Newmeyer Dillion counsels clients confronted by seemingly insurmountable debt in down markets to evaluate their liquidation options and start a new chapter in their lives. Adept at identifying exemptions, the attorneys in our bankruptcy group are also skilled at addressing misconceptions about loss of assets, including issues around California’s 2007 Mortgage Forgiveness Debt Relief Act. Our focus identifies exempt and non-exempt assets, secured creditors, and tax considerations to craft reasonable repayment plans. We have represented debtors and creditors, giving us a 360-degree perspective. For debtors, we aggressively negotiate and litigate to eliminate debt and preserve assets. For creditors, we file critical motions and attend meetings of unsecured creditors and distressed companies to ensure equitable distribution of funds.
Chapter 7 bankruptcy is an option for individuals who satisfy the Means Test. The Means Test is the Bankruptcy Court’s way of determining your ability to pay your debt. It is based on the median income in California and by the number of people in the household.
California Median Income Standards for Means Test for Cases Filed On or After May 1, 2020:
Nevada Median Income Standards for Means Test for Cases Filed On or After May 1, 2020
Your income is determined by your 6-month average prior to filing, minus qualified deductions from your gross income such as income taxes, mortgage payments, and car payments. If your CMI (Current Monthly Income) is below the median household income, you will qualify for a Chapter 7 bankruptcy. It typically takes 90 days from the day we file your case to the final discharge of a Chapter 7 “No Asset” case. You will have to participate in this process.
The Participation Process
- You must provide all documents requested by our firm in our client questionnaire.
- You must take a pre-filing credit counseling course online. This program takes about one hour to complete. Once you’ve completed the course, we will receive your certificate of completion. The certificate must be filed with the bankruptcy documents.
- After your case is filed, a Trustee will be appointed and a 341 Meeting of Creditors will be scheduled. You will have to attend the 341 Meeting of Creditors, which is held by the Trustee in their office in the Federal Building within the respective city, depending on where you reside. You will be asked questions about your bankruptcy filing under oath. We will be sitting across the table from you. A Chapter 7 341 meeting typically takes no more than 5 minutes. Creditors have the right to attend these meetings. Most often creditors do not actually attend these meetings, but if they are in attendance, they have the right to speak regarding the debts owed to them.
- Similar to the pre-filing credit counseling course, you must take the Financial Management Course or post-bankruptcy class within 45 days of the date of filing. The course is required for discharge and if not timely filed, the case will be closed without a discharge.