How does personal bankruptcy work in california?

It's interesting:
"Even world class comics know what it's like to die on stage, and a wedding ... Nobody wants the soundtrack of their wedding night to be a chorus of loud groans."

The general rules for bankruptcy in California are similar to those in any other state, as California must obey the federal rules of bankruptcy procedure. However, California does have its own list of property that you can protect in a Chapter 7 bankruptcy. California also has its own income limitations for bankruptcy qualification.

1. Bankruptcy Chapters

   • For personal debtors, the two main types of bankruptcy are Chapter 7 and Chapter 13. Under Chapter 7, the bankruptcy court will take possession of your assets and create what is known as the bankruptcy estate. In California, you can protect only a certain amount of these assets from liquidation using one of the two state-specific exemption systems. For example, under California exemption system 1, you can protect up to $5,000 in jewelry, while under system 2, you can only protect up to $1,150 in jewelry. Any amount in excess of the California exemption levels will be sold for the benefit of creditors. A Chapter 13 bankruptcy does not use exemptions, as all of your property is exempt. In return, you must make payments to your creditors under a plan approved by the California bankruptcy court.

   Means Testing

   • For many debtors, a Chapter 7 bankruptcy is preferable to a Chapter 13 bankruptcy. If you do not have valuable assets, you can generally receive a Chapter 7 bankruptcy discharge in just a few months and do not have to make any payments at all to creditors. A Chapter 13 bankruptcy, on the other hand, could involve as many as five years of payments before you earn your discharge. However, to qualify for a Chapter 7 bankruptcy you must have little or no monthly disposable income as determined by a process known as the means test. If your monthly income after subtracting allowable expenses is too high to pass the means test, you are only eligible to file Chapter 13 bankruptcy. Allowable expenses are determined by the California county in which you reside.

   Educational Course Requirements

   • In order to receive a bankruptcy discharge in California, you must take two educational courses by a court-approved provider. The first course is a credit counseling course that you must take no more than 180 days before you file your bankruptcy petition. The second course is a financial management course that you must take within 45 days after your mandatory meeting before the bankruptcy trustee.

   Court Location

   • You must file your bankruptcy petition with the bankruptcy court assigned to your district. The four bankruptcy districts are the Northern, Southern, Eastern and Central. Each district may have more than one courthouse, and each courthouse may serve more than one county. For example, the California Central Bankruptcy District serves seven counties but only has five court locations, in Los Angeles, Riverside, Santa Ana, Santa Barbara and Woodland Hills.

   Section 341 Meeting of Creditors

   • Within about a month after you file your bankruptcy petition, you must appear before your bankruptcy trustee and any creditors that wish to appear at the Section 341 Meeting of Creditors. The trustee will review your petition and may ask you specific questions about your assets, liabilities or other information in the petition.

   Bankruptcy Discharge

   • If the court does not receive any objections to your petition within 60 days after your Section 341 meeting, you are entitled to a discharge. In California, a discharge may be administratively delayed due to the number of cases in the system, but your legal right to a discharge is unaffected.

Source: www.ehow.com

Tags: Chapter bankruptcy, your bankruptcy, bankruptcy court, bankruptcy petition, file your