I am going to file Chapter 7 bankruptcy in Riverside Ca due to the fact in 2011 i lost my job. I was the only person bringing money into my home and i had to let my credit cards go and continue to make my most important bills, mortgage and car payment with my unemployment since that was my only vehicle for me and my family. Now fast forward to march of 2014 after missing several house payments, my bank just approved me for a loan modification. Now my question is if i file for chapter 7 and exclude my home and car from it and only apply the outstanding credit cards and win my case, can any creditor or attorney come after me for my home? Also if i get approved for chapter 7 can they come after me any other way? wage garnishments, etc. even though i was granted chapter 7?
2 Answers from Attorneys
Hi. Your Ch 7 filling will eliminate forever all your unsecured debts...such as your credit cards. Federal law requires that you disclose all your assets including your home and car..and disclose all your debts including your mortgage and car loan, credit cards, etc...but it sounds like if u got a modification your home is probably worth less than u owe so there's no equity to worry about...and with regard to your car it will be your choice to keep it and continue paying for it...or return it and cancel the debt...or redeem it if it's worth substantially less than u owe. Once your debts are discharged none of the discharged creditors can ever come after you. That's your fresh start and that's what chapter 7 is all about.
Discharge (through bankruptcy) of debts that are in default will preclude creditors from garnishing, levying or encumbering your property. Prepetition judgment liens must be dealt with via separate procedure during the pendency of one's bankruptcy case.
This answer (as well as our Web site) by Bankruptcy Attorney, Asaph Abrams doesnít address all facts & implications of the question; itís general bankruptcy info, not legal advice to be relied upon. The answer creates no attorney-client relationship; it may be pertinent to CA bankruptcy law only and itís independent of other answers. Seek legal counsel before acting on or refraining from bankruptcy- or other legal-action.