Bankruptcy Filing Lawyer: Stop Collections, Protect Assets and Strategize Your Financial Recovery

If a foreclosure sale has been scheduled for your home, the filing of a bankruptcy petition immediately suspends the auction. Unlike private negotiation or debt settlement programs which rely on the voluntary cooperation of the lender, the automatic stay is a mandatory court order. This provides the necessary window to evaluate whether you should utilize a Chapter 13 reorganization to catch up on mortgage arrears or a Chapter 7 liquidation to surrender the property without the risk of a deficiency judgment.

Creditors frequently utilize wage garnishments to seize twenty-five percent of your disposable income directly from your paycheck, often causing a cascading failure of your ability to pay for utilities, housing and medical care. A bankruptcy filing lawyer ensures that all creditors are notified within minutes of the filing to stop these deductions. We move aggressively to ensure that any funds taken after the filing are returned and that your bank accounts are unfrozen so that you can maintain the liquidity necessary for daily survival.

If you are a defendant in a civil lawsuit for debt, the bankruptcy filing pulls that litigation into the federal arena and freezes the state court proceedings. This prevents the creditor from obtaining a judgment lien against your real estate while the bankruptcy court determines the ultimate dischargeability of the debt. By consolidating all financial disputes into one forum, we can resolve your liabilities through a single, unified legal strategy rather than fighting a war of attrition on multiple fronts.

In a Chapter 7 case, the goal is the total liquidation of qualifying unsecured liabilities, leaving the debtor with a clean slate. This process is highly efficient for individuals who meet the means test and do not have significant non-exempt assets that a trustee could seize for the benefit of creditors. Once the discharge order is signed, you are permanently relieved of any legal obligation to pay the discharged debts, providing you with the financial mobility to rebuild your credit and your life.

If your home equity exceeds state exemption limits or if your income is too high for Chapter 7, Chapter 13 provides a mechanism to reorganize your debt without losing your property. You pay your disposable income into a court-approved plan for sixty months, satisfying priority debts and a portion of your unsecured debt. At the conclusion of the plan, the remaining balance of your qualifying unsecured debt is discharged, often allowing you to settle these liabilities for cents on the dollar while keeping your home and business intact.

While most people believe that taxes and student loans can never be discharged, modern legal trends have created narrow pathways for relief in certain bankruptcy filings. Qualifying income taxes that are sufficiently old can be liquidated entirely if they meet the three-two-two-forty rules. Similarly, we utilize adversary proceedings to challenge the non-dischargeability of student loans when they create an undue hardship. We perform a forensic audit of your financial history to identify these hidden opportunities for total debt relief.

The means test is not a simple math problem; it is a legal argument where the inclusion of specific deductions can mean the difference between a total discharge and a five year payment plan. We analyze your mandatory payroll deductions, health insurance costs, childcare expenses and secured debt payments to maximize your allowed expenses. Our objective is to provide the court with a forensically defensible record that proves you lack the disposable income to fund a reorganization plan.

The timing of your bankruptcy filing is critical to the outcome of the means test. Because the test looks at the previous six months of income, filing immediately after a high-commission month or a seasonal bonus can lead to an artificially high income average. We strategize the exact date of your filing to ensure that your income average is at its lowest possible point, providing the best statistical chance for Chapter 7 eligibility.

Even if you pass the mathematical portion of the means test, a judge can still dismiss your case if the "totality of the circumstances" suggests you have the ability to pay your creditors. This often occurs when a debtor has low monthly expenses but high income, or when their schedules show a significant budget surplus. We prepare your bankruptcy schedules with a focus on long-term financial reality, ensuring that your budget is a true reflection of your economic hardship and not an invitation for a bad faith challenge.

Depending on the state where you live and how long you have resided there, you may have the choice between using federal bankruptcy exemptions or your specific state’s exemptions. This choice is a critical tactical decision. Some states have "unlimited" homestead exemptions that protect all the equity in your home, while the federal exemptions may offer a more generous "wildcard" for cash or other assets. We perform a comparative analysis of these options to determine which scheme provides the maximum protection for your specific asset portfolio.

Under federal law, most ERISA-qualified retirement accounts, 401k plans and IRAs are fully exempt from the bankruptcy estate, regardless of their value. This means you can often discharge millions of dollars in debt while keeping your entire retirement nest egg intact. However, inherited IRAs and certain other investment accounts may not receive the same protection. We audit your investment accounts prior to the bankruptcy filing to ensure that your retirement security is not compromised during the process.

The value you place on your assets in your bankruptcy schedules is an open invitation for a trustee to investigate. If you undervalue your home or your business to fit within an exemption limit, the trustee can hire their own appraiser and move to sell the property if they find hidden equity. SJKP LLP utilizes professional appraisals and market data to establish a defensible valuation of your assets, neutralizing the trustee's ability to claim that your property is a candidate for liquidation.

The bankruptcy trustee has the authority to look back two years under federal law and often up to four or six years under state law to identify any transfers made for less than "reasonably equivalent value." If you sold a car to a cousin for a dollar or transferred your interest in a vacation home for no consideration, the trustee will initiate a lawsuit to void that transfer. We conduct a thorough pre-filing audit of your financial history to identify these risks and resolve them before the petition is ever filed.

A preferential payment occurs when you pay one creditor, such as a family member or a business associate, while ignoring your other commercial debts within one year of filing. The law requires that all creditors be treated equally. If you paid back a ten thousand dollar loan to your brother six months ago, the trustee can claw that money back from him to distribute it among your credit card companies. We review your bank statements and payment history to ensure that your filing does not inadvertently expose your inner circle to federal litigation.

Bankruptcy is a transparent process that requires the absolute disclosure of all income, assets and prior transactions. Attempting to hide a transfer or omit an account from your schedules is a federal crime and a guaranteed way to have your discharge denied for life. In the modern era, trustees utilize sophisticated software to cross-reference your filings with public records, social media and bank data. SJKP LLP ensures that your petition is forensically accurate, providing a clear and defensible record that satisfies the court’s requirement for full disclosure.

One of the most dangerous aspects of a Chapter 7 filing is that it is essentially a one-way door. Once you file the petition, you do not have an absolute right to dismiss the case if you change your mind. If you realize after filing that the trustee is going to take your house because you claimed the wrong exemption, the court may refuse to let you out of the bankruptcy. This results in the forced sale of your home while you are legally stuck in a process you no longer want.

Every person who files for bankruptcy must testify under oath before the trustee at a meeting of creditors. The trustee’s job is to find assets to sell, and they are trained to look for inconsistencies in your testimony and your filed schedules. Without a bankruptcy filing lawyer to prepare your testimony and defend you during the meeting, a simple misstatement can lead to an investigation for bankruptcy fraud or a move by the trustee to seize property you thought was safe.

If a creditor or the trustee believes you have committed fraud or that a debt should not be discharged, they will file an "adversary proceeding," which is a full-scale federal lawsuit within your bankruptcy case. Handling a federal trial pro se is a recipe for failure. We represent our clients in these high-stakes litigation matters, using our expertise in the bankruptcy code to defeat creditor challenges and ensure that your discharge is protected.