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Chapter 7
Keeping it simple.
In a Chapter 7 case, the trustee collects the property of the estate, reduces it to cash, and pays claimants in a prescribed order. Some key things to consider in dealing with this issue are:Ordinarily, under secured creditors (collateral is worth less than loan) pass through the bankruptcy unaffected except that they lose their rights to seek personal liability against the bankruptcy debtor.
Over secured creditors (collateral is worth more than the value of the loan) are paid out of the proceeds of the sale of the collateral, with the balance distributed to unsecured creditors according to priority.
Unsecured priority claimants receive distribution ahead of the general unsecured creditors. If there is not enough money to pay all claims at a particular level, claimants within that level take a pro rata share.
In a Chapter 7 consumer bankruptcy, over secured debt is rarely liquidated because the equity portion above and beyond the amount of the loan is subject to the bankruptcy debtors real and personal property exemptions and is not property of the bankruptcy estate.
Chapter 7 Trustee
In a consumer bankruptcy Chapter 7 debtors often avoid the liquidation of assets because of personal property exemptions available for individual non-business filers, however no attorney can guarantee how a particular trustee will carry out his duties where a debtor has over used his exemptions.. Our statements to clients as to what a trustee may do with a particular piece of property are our best professional estimates only. The actual decision is the trustee's alone, in the exercise of the business judgment rule. If you have non-exempt property and are going into a Chapter 7, whether or not the trustee will liquidate the property depends on who the trustee is, what jurisdiction the case is in and the equities of your case.Practical Considerations
The equities of your case depend on a variety of morality considerations that a professional bankruptcy attorney can help evaluate. For instance, if you have various properties that are worth more than the exemption amount it is more likely that the trustee will force you to buy back the property from the bankruptcy estate or surrender it. This is particularly true where you also have income sufficient to repay some of your debt in a chapter 13 plan. While as a lower income homeowner who's been living on reduced hours and owns a $6,000 vehicle is likely to keep the vehicle in spite of the exemption amount of $3,400.00, Someone who is better situated, owns numerous items of personal property that are non-exempt or partially exempt, and has an average income will most likely run into of the trustee's liquidation powers. Trustees may also be sensitive to the amount of fees that you have paid your attorney, which must be disclosed in the attorneys 1019 statement. A middle income or better debtor filing a Chapter 7 is generally expected to pay a fee commensurate with an understanding of the complexities of the bankruptcy laws and the advantage which the bankruptcy offers. When people who have the ability to pay a standard fee hire an attorney for $600.00 or less, they are more likely to run afoul of the bankruptcy trustees discretion, as system insiders generally consider middle income price shoppers to be disrespectful to the bankruptcy court itself. This is not a rule that you'll find written on the books anywhere, but experience demonstrates that clients that have paid a $950.00 fee retainer to our office have often received a favorably stretched interpretation of the chapter 7 standards from trustees, while as similarly situated individuals who have held us to telephone solicitations for cheap deals often don't seem to make out as well. This is a factor that's hard to quantify, but to realize that almost all trustees are also bankruptcy attorney's themselves and may have strong negative feelings about forced to accept cases for reduced fees in their own practice, that may carry over into other cases.Our Services
If you are facing foreclosures, repossessions, wage garnishments, liens, and constant calls and letters from creditors and collection agencies, we are ready to assist you. The Pacific Bankruptcy Center is a debt relief agency, aiding clients in filing for bankruptcy relief under the Bankruptcy Code. Contact a bankruptcy lawyer at our firm today to learn more through an honest assessment of your situation
National City, California
National City is located at 32°40′15″N, 117°5′34″W According to the United States Census Bureau, the city has a total area of 23.9 km˛ (9.2 mi˛). 19.1 km˛ (7.4 mi˛) of it is land and 4.8 km˛ (1.9 mi˛) of it (20.13%) is water. National City is bounded by San Diego to the north and northeast, Bonita to the east, and Chula Vista to the south. San Diego Bay lies to the immediate west of the city. Also, within the boundaries of National City on the eastern side of town is the unincorporated area of San Diego County known as Lincoln Acres.
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