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(619) 285-1992 ATTORNEY@SDBANKRUPT.COM
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HELPING INDIVIDUALS AND FAMILIES
GET A FRESH START
ONE DEBTOR AT A TIME...
AFFORDABLE DEBT RELIEF
Free Consultation 619.285.1992
STOP/PREVENT
* COLLECTOR HARRASSMENT
* WAGE GARNISHMENTS
* BANK LEVY
* FORECLOSURE
Centrally Located in Mission Valley:
3443 Camino Del Rio South #319, 92108
(free parking, convenient appointments)
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PROFESSIONAL
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Bankruptcy law protection reflects our society's acceptance that debt forgiveness
benefits society as a whole by releasing debtors overburdened by financial obligations and restoring contributing consumers.
Tokarska Law Center zealously represents and guides debtors in Bankruptcy
filings. Your case is handled personally by an experienced attorney dedicated to providing professional, caring and
prompt service at reasonable cost.
WHAT IS THE PROCESS?
The
first and critical step is to take stock and evaluate the financial situation. Your attorney will want to
know information as it pertains to your
- Debts
- Income
- Expenses
- Property
Click Here to Download Information Sheet
2. DOCUMENT GATHERING AND PREPARATION OF THE PETITION
Once
a decision has been made that Bankruptcy is the best alternative, your attorney will want to gather additional information
and documentation necessary in preparing a bankruptcy petition, which includes forms, also known as schedules.
It is important to be accurate and forthcoming with the information required, not to omit,
or make mistakes in calculations. Certain required documents supporting the information
provided within the petition must be timely submitted to the Trustee for review. This includes: financial statements,
copies of deeds, pay stubs, profit & loss statements, security agreements, valuations of property, and others.
Click Here to Download Supporting Document Checklist
3. CREDIT COUNSELING
The
new Bankruptcy rules require that the petitioner attend a credit counseling course.
No petition can be filed without a certificate evidencing completion of the course. The counseling is provided through approved credit counseling agencies and may be obtained in person, over
the phone, or through the internet.
| Bankruptcy Credit Counseling and Debtor Education |
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4. FILING OF YOUR PETITION
Once
the necessary documents are delivered to your attorney, the petition can generally be prepared within 24 hours. Emergency
situations could warrant a faster filing.
Your
Attorney will meet with you to review the contents of the petition, get all the necessary documents signed and ready for filing.
The
filing is completed electronically and a confirmation is usually received instantly. Within a day or two, the case is
assigned to a Trustee and a date and time for the Creditor's Meeting is scheduled (usually 30 days after filing).
Your
attorney will notify you immediately of the appointed day and time to ensure that you are available to attend this meeting.
The
bankruptcy court mails out notices to your creditors and as a result within 2-3 days all contact from creditors and collection
agencies is strictly forbidden. Communication with regards to your case can be made by the creditors to your attorney.
5. CREDITOR'S MEETING
Your
attorney will attend the creditor's meeting with you. This meeting is handled by the Trustee, who is assigned by the
United States Trustee Office with the Department of Justice. The Trustee's job is to review your petition and the supporting
documents for accuracy, to administer any assets that may be available for the benefit of the creditors.
6. DEBTOR'S EDUCATION COURSE
After the creditor's meeting, a period of 60 days must pass, allowing any creditors
to object to discharge. This is what is commonly known as "scream or die". If the time period lapses and the creditors
fail to object any valid claim they may have, it is lost once the 60 day period passes.
The law requires that in order to receive a discharge, a petitioner must complete a Debtor's Education
Course. Similar to the Credit Counseling Course, the course can be completed online. A certificate is issued and
an additional form must be filed with the court confirming the completion of this course. Failure to complete the course
can result in your case being closed, without discharge.
Other considerations may include dealing with reaffirmation agreements. Secured
lenders, such as those that provide money to purchase cars, may require that you sign a new agreement, post filing, with same
or sometimes better terms in order to keep the vehicle(s). Your attorney will discuss your loan(s) with the lenders
and obtain the necessary documents for your signature.
Bankruptcy Glossary
Following are definitions and explanations for frequently-used words and phrases related to bankruptcy.
Adversary Proceeding: A lawsuit arising in or related to a bankruptcy case
that is commenced by filing a complaint with the court.
Assume:
An agreement to continue performing duties under a contract or lease.
Automatic Stay: An injunction that automatically stops lawsuits, foreclosures, garnishments, and all
collection activity against the debtor the moment a bankruptcy petition is filed.
Bankruptcy: A legal procedure for dealing with debt problems of individuals and businesses; specifically, a case filed under one
of the chapters of title 11 of the United States Code (the Bankruptcy Code).
Bankruptcy Administrator: An officer of the judiciary serving in the judicial districts of Alabama and North
Carolina who, like the U.S. trustee, is responsible for supervising the administration of bankruptcy cases, estates, and trustees;
monitoring plans and disclosure statements; monitoring creditors' committees; monitoring fee applications; and performing
other statutory duties. Compare U.S. trustee.
Bankruptcy
Code: The informal name for title 11 of the United States Code (11 U.S.C. sections 101-1330), the federal bankruptcy law.
Bankruptcy Court: The bankruptcy judges in regular active service in
each federal judicial district; a unit of the district court.
Bankruptcy Estate: All legal or equitable interests of the debtor in property at the time of the bankruptcy
filing. (The estate includes all property in which the debtor has an interest, even if it is owned or held by another person.)
Bankruptcy Judge: A judicial officer of the United
States district court who is the court official with decision-making power over federal bankruptcy cases.
Bankruptcy Petition: The document filed by the debtor (in a voluntary case)
or by creditors (in an involuntary case) which opens the bankruptcy case. (There are official forms for bankruptcy petitions.)
Chapter 7: The chapter of the Bankruptcy
Code providing for "liquidation" (i.e., the sale of a debtor's nonexempt property and the distribution of the proceeds to
creditors).
Chapter 9: The chapter of
the Bankruptcy Code providing for reorganization of municipalities (which includes cities and towns, as well as villages,
counties, taxing
districts, municipal utilities, and school districts).
Chapter 11: The chapter of the Bankruptcy Code providing (generally) for reorganization, usually involving a corporation or partnership.
(A chapter 11
debtor usually proposes a plan of reorganization to keep its business alive and pay creditors over time.
People in business or individuals can also seek relief in chapter 11.)
Chapter 12: The chapter of the Bankruptcy Code providing for adjustment of debts of a "family farmer," or a "family fisherman"
as those terms are defined in the Bankruptcy Code.
Chapter
13: The chapter of the Bankruptcy Code providing for adjustment of debts of an individual with regular income. (Chapter
13 allows a debtor to keep property and pay debts over time, usually three to five years.)
Claim: A creditor's assertion of a right to payment from the bankruptcy debtor or the debtor's property.
Confirmation: Bankruptcy judge's approval of a plan of reorganization
or liquidation in chapter 11, or payment plan in chapter 12 or 13.
Consumer Debtor: A debtor whose debts are primarily consumer debts.
Consumer Debts: Debts incurred for personal (as opposed to business) needs.
Contested Matter: Those matters, other than objections to claims, that
are disputed but are not within the definition of an "adversary proceeding".
Contingent Claim: A claim that may be owed by the debtor under certain circumstances, e.g., where the
debtor is a cosigner on another person's loan and that person fails to pay.
Creditor: One to whom the debtor owes money or who claims to be owed money by the debtor.
Credit Counseling: Generally refers to two events in individual bankruptcy cases: (1) the "individual
or group briefing" from a nonprofit budget and credit counseling agency that individual debtors must attend prior to filing
under any chapter of the Bankruptcy Code; and (2) the "instructional course in personal financial management" in chapters
7 and 13 that an individual debtor must complete before a discharge is entered. There are exceptions to both requirements
for certain categories of debtors, exigent circumstances, or if the U.S. trustee or bankruptcy administrator have determined
that there are insufficient approved credit counseling agencies available to provide the necessary counseling.
Creditors' Meeting: see 341 meeting
Current Monthly Income: The average monthly income received
by the debtor over the six calendar months before commencement of the bankruptcy case, including regular contributions to
household expenses from nondebtors and income from the debtor's spouse if the petition is a joint petition, but not including
social security income and certain other payments made because the debtor is the victim of certain crimes.
Debtor: A person who has filed a petition
for relief under the Bankruptcy Code.
Debtor Education:
see credit counseling
Defendant: An individual
(or business) against whom a lawsuit is filed.
Discharge:
A release of a debtor from personal liability for certain dischargeable debts identified in the Bankruptcy Code. A
discharge releases a debtor from personal liability for certain debts known as dischargeable debts and prevents the creditors
owed those debts from taking any action against the debtor to collect the debts. The discharge also prohibits creditors from
communicating with the debtor regarding the debt, including telephone calls, letters, and personal contact.
Dischargeable Debt: A debt for which the Bankruptcy Code allows the debtor's
personal liability to be eliminated.
Disclosure Statement:
A written document prepared by a chapter 11 debtor or other plan proponent designed to provide "adequate information"
to creditors to enable them to evaluate the chapter 11 plan of reorganization.
Equity: The value of a debtor's interest in property that remains after liens and other creditors' interests are considered.
(Example: If a house valued at $100,000 is subject to a $80,000 mortgage, there is $20,000 of equity.)
Executory Contract or Lease: Generally includes contracts or leases under
which both parties to the agreement have duties remaining to be performed. (If a contract or lease is executory, a debtor
may assume it or reject it.)
Exemptions, Exempt Property:
Certain property owned by an individual debtor that the Bankruptcy Code or applicable state law permits the debtor to keep
from unsecured creditors. For example, in some states the debtor may be able to exempt all or a portion of the equity in the
debtor's primary residence (homestead exemption), or some or all "tools of the trade" used by the debtor to make a living
(i.e., auto tools for an auto mechanic or dental tools for a dentist). The availability and amount of property the debtor
may exempt depends on the state the debtor lives in.
Family
Farmer or Family Fisherman: An individual, individual and spouse, corporation, or partnership engaged in a farming
or fishing operation that meets certain debt limits and other statutory criteria for filing a bankruptcy petition under chapter
12.
Fraudulent Transfer: A transfer of a
debtor's property made with intent to defraud or for which the debtor receives less than the transferred property's value.
Fresh Start: The characterization of a debtor's status after bankruptcy,
i.e., free of most debts. (Giving debtors a fresh start is one purpose of the Bankruptcy Code.)
Insider (of an Individual Debtor): Any relative of the debtor or of a general
partner of the debtor; partnership in which the debtor is a general partner; general partner of the debtor; or a corporation
of which the debtor is a director, officer, or person in control.
Insider (of a Corporate Debtor): A director, officer, or person in control of the debtor; a partnership
in which the debtor is a general partner; a general partner of the debtor; or a relative of a general partner, director, officer,
or person in control of the debtor.
Joint Administration:
A court-approved mechanism under
which two or more cases can be administered together. (Assuming no conflicts of interest, these separate businesses or individuals
can pool their resources, hire the same professionals, etc.)
Joint Petition: One bankruptcy petition filed by a husband and wife together.
Lien: The right to take and hold or sell the property of a debtor as security
or payment for a debt or duty.
Liquidation:
A sale of a debtor's property with the proceeds to be used for the benefit of creditors.
Liquidated Claim: A creditor's claim for a fixed amount of money.
Means Test: Section 707(b)(2) of the Bankruptcy Code applies a "means test" to determine whether an individual debtor's chapter
7 filing is presumed to be an abuse of the Bankruptcy Code requiring dismissal or conversion of the case (generally to chapter
13). Abuse is presumed if the debtor's aggregate current monthly income (see definition above) over 5 years, net of certain
statutorily allowed expenses, is more than (i) $10,000, or (ii) 25% of the debtor's nonpriority unsecured debt, as long as
that amount is at least $6,000. The debtor may rebut a presumption of abuse only by a showing of special circumstances that
justify additional expenses or adjustments of current monthly income.
Motion to Lift the Automatic Stay: A request by a creditor to allow the creditor to take action against the
debtor or the debtor's property that would otherwise be prohibited by the automatic stay.
No-Asset Case: A chapter 7 case where there are no assets available to satisfy any portion of the
creditors' unsecured claims.
Nondischargeable Debt: A
debt that cannot be eliminated in bankruptcy. Examples include a home mortgage, debts for alimony or child support, certain
taxes, debts for most government funded or guaranteed educational loans or benefit overpayments, debts arising from death
or personal injury caused by driving while intoxicated or under the influence of drugs, and debts for restitution or a criminal
fine included in a sentence on the debtor's conviction of a crime. Some debts, such as debts for money or property obtained
by false pretenses and debts for fraud or defalcation while acting in a fiduciary capacity may be declared nondischargeable
only if a creditor timely files and prevails in a nondischargeability action.
Objection to Dischargeability: A trustee's or creditor's objection to the debtor being released from personal liability
for certain dischargeable debts. Common reasons include allegations that the debt to be discharged was incurred by false pretenses
or that debt arose because of the debtor's fraud while acting as a fiduciary.
Objection to Exemptions: A trustee's or creditor's objection to the debtor's attempt to claim certain property
as exempt from liquidation by the trustee to creditors.
Party
in Interest: A party who has standing to be heard by the court in a matter to be decided in the bankruptcy case. The debtor, the
U.S. trustee or bankruptcy administrator, the case trustee and creditors are parties in interest for most matters.
Petition Preparer: A business not authorized to practice law that prepares
bankruptcy petitions.
Plan: A debtor's detailed
description of how the debtor proposes to pay creditors' claims over a fixed period of time.
Plaintiff: A person or business that files a formal complaint
with the court.
Postpetition Transfer: A
transfer of the debtor's property made after the commencement of the case.
Prebankruptcy Planning: The arrangement (or rearrangement) of a debtor's property to allow the debtor to take
maximum advantage of exemptions. (Prebankruptcy planning typically includes converting nonexempt assets into exempt assets.)
Preference or Preferential Debt Payment: A debt payment made to
a creditor in the 90-day period before a debtor files bankruptcy (or within one year if the creditor was an insider) that
gives the creditor more than the creditor would receive in the debtor's chapter 7 case.
Presumption of Abuse: see means test
Priority:
The Bankruptcy Code's statutory ranking of unsecured claims that determines the order in which unsecured claims will be paid
if there is not enough money to pay all unsecured claims in full. For example, under the Bankruptcy Code's priority scheme,
money owed to the case trustee or for prepetition alimony and/or child support must be paid in full before any general unsecured
debt (i.e. trade debt or credit card debt) is paid.
Priority
Claim: An unsecured claim that is entitled to be paid ahead of other unsecured claims that are not entitled to priority status.
Priority refers to the order in which these unsecured claims are to be paid.proof of claim A written statement and verifying
documentation filed by a creditor that describes the reason the debtor owes the creditor money. (There is an official form
for this purpose.)
Property of the Estate: All
legal or equitable interests of the debtor in property as of the commencement of the case.
Reaffirmation Agreement: An agreement by a chapter 7 debtor to continue paying a dischargeable debt (such as
an auto loan) after the bankruptcy, usually for the purpose of keeping collateral (i.e. the car) that would otherwise be subject
to repossession.
Secured Creditor:
A creditor holding a claim against the debtor who has the right to take and hold or sell certain property of the debtor in
satisfaction of some or all of the claim.
Secured Debt:
Debt backed by a mortgage, pledge of collateral, or other lien; debt for which the creditor has the right to pursue
specific pledged property upon default. Examples include home mortgages, auto loans and tax liens.
Schedules: Detailed lists filed by the debtor along with (or shortly
after filing) the petition showing the debtor's assets, liabilities, and other financial information. (There are official
forms a debtor must use.)
Small Business Case:
A special type of chapter 11 case in which there is no creditors' committee (or the creditors' committee is deemed inactive
by the court) and in which the debtor is subject to more oversight by the U.S. trustee than other chapter 11 debtors. The
Bankruptcy Code contains certain provisions designed to reduce the time a small business debtor is in bankruptcy.
Statement of Financial Affairs: A series of questions the debtor must answer
in writing, concerning sources of income, transfers of property, lawsuits by creditors, etc. (There is an official form a
debtor must use.)
Statement of Intention:
A declaration made by a chapter 7 debtor concerning plans for dealing with consumer debts that are secured by property of
the estate.
Substantive Consolidation: Putting
the assets and liabilities of two or more related debtors into a single pool to pay creditors. (Courts are reluctant to allow
substantive consolidation since the action must not only justify the benefit that one set of creditors receives, but also
the harm that other creditors suffer as a result.)
341
Meeting: The meeting of creditors required by section 341 of the Bankruptcy Code, at which the debtor is questioned under oath
by creditors, a trustee, examiner, or the U.S. trustee about his/her financial affairs. Also called "creditors' meeting".
Transfer: Any mode or means by which a debtor disposes of (or parts with) the debtor's
property.
Trustee: The representative of the bankruptcy
estate who exercises statutory powers, principally for the benefit of the unsecured creditors, under the general supervision
of the court and the direct supervision of the U.S. trustee or bankruptcy administrator. The trustee is a private individual
or corporation appointed in all chapter 7, chapter 12, and chapter 13 cases and some chapter 11 cases. The trustee's responsibilities
include reviewing the debtor's petition and schedules and bringing actions against creditors or the debtor to recover property
of the bankruptcy estate. In chapter 7, the trustee liquidates property of the estate, and makes distributions to creditors.
Trustees in chapter 12 and 13 have similar duties to a chapter 7 trustee and the additional responsibilities of overseeing
the debtor's plan, receiving payments from debtors, and disbursing plan payments to creditors.
U.S. Trustee: An officer of the Justice Department
responsible for supervising the administration of bankruptcy cases, estates, and trustees; monitoring plans and disclosure
statements; monitoring creditors' committees; monitoring fee applications; and performing other statutory duties. Compare,
bankruptcy administrator.
Undersecured Claim:
A debt secured by property that is worth less than the full amount of the debt.
Unliquidated Claim: A claim for which a specific value has not been determined.
Unscheduled Debt: A debt that should have been listed by the debtor
in the schedules filed with the court but was not. (Depending on the circumstances, an unscheduled debt may or may not be
discharged.)
Unsecured Claim: A claim or debt for which a
creditor holds no special assurance of payment, such as a mortgage or lien; a debt for which credit was extended based solely
upon the creditor's assessment of the debtor's future ability to pay.
Voluntary Transfer: A transfer of a debtor's property with the debtor's consent.
From the Administrative Office of the U.S. Courts
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