California Personal Bankruptcy Laws

California personal bankruptcy allows residents in financial hardship to discharge their debts or restructure them in a way that will allow them to repay their creditors. If you are a homeowner, in many cases you will be able to stay in your home while stopping collection calls, lawsuits and garnished wages.

Types

California residents filing for personal bankruptcy may request relief under either Chapter 7 or Chapter 13.

Means Testing

To qualify for Chapter 7 Bankruptcy in California, the debtor's yearly income must fall below the median income for the state. For a family of two persons, California's median income is $46,814.

Exemptions

Under California law, you may choose between two exemption schemes and choose which scenario will best suit your needs based on the equity in your home and value of your vehicle, jewelry and personal property.

Discharges

As a California resident, your medical bills, credit card debts and any judgments against you will be discharged in your bankruptcy.

Responsibilities

Pursuant to federal law, you will still be responsible for child support, alimony, government fines and student loans after filing bankruptcy in California.

References

• Bankruptcy in California

Resources

• Bankruptcy Basics