Chapter 13 Bankruptcy

Chapter 13 Bankruptcy

When you are making the decision on whether or not to file for bankruptcy, there are always a lot of questions. This is a decision that will affect your future credit and, at times, your reputation. There are many types if bankruptcy that you can file for different circumstances, so you need to make sure that which type you file is the right one for your situation.

If you want to file for Chapter 13 bankruptcy, you should become familiar with some details. Chapter 13 Bankruptcy (also called a wage-earners plan) will allow a person with regular income to create a plan to repay all or part of his or her debts over time. Under Chapter 13 bankruptcy, a debtor proposes a repayment plan to make installments to creditors over a period of 3 to 5 years.

Chapter 13 Eligibility

Before you file, you need to know whether or not your actual situation makes you eligible for Chapter 13. In California, “Any individual, even if they are self-employed or operating an unincorporated business, is eligible for chapter 13 relief so long as the individual’s unsecured debts are less than $395,725 and secured debts are less than $1,184,200.” These amounts are adjusted periodically to reflect changes in the consumer price index. In addition, a corporation or partnership may not be a chapter 13 debtor.

The Bad Outcomes or “Cons” of Chapter 13 Bankruptcy

Filing for Chapter 13 Bankruptcy can take up to five years for you to repay your debts.

Your debts must be paid out of your ‘disposable’ income. This means that the income you have left after spending on necessities like food, shelter, or medical care is used to pay off your debt. All of your extra cash will be tied up during the entirety of your repayment plan.

Filing a Chapter 13 bankruptcy will remain on your credit report for up to a total of 10 years.

You will lose all of your credit cards, meaning you will be very limited on your extra money, since it is all already tied up in the repayment plan.

Having a Chapter 13 Bankruptcy on your credit report will make it more difficult to get a mortgage if you do not already have one.

You will not be able to file for a Chapter 7 Bankruptcy if you went through any bankruptcy proceedings under Chapter 13 within the last 6 years.

Declaring Chapter 13 bankruptcy now will make it harder for you to declare Chapter 7 later if you need to.

You will not be able to file for Chapter 13 bankruptcy if a previous Chapter 7 or Chapter 13 case was dismissed within the past 180 days, for reasons such as violating a court order or requesting dismissal after a creditor asked for relief from the automatic stay.

Filing Chapter 13 bankruptcy will not get rid of your obligations to pay any alimony or child support.

Filing Chapter 13 bankruptcy will also not get rid of your student loan debt.

Even if you have filed Chapter 13 bankruptcy, you may still be obligated to pay some of your debts, like a mortgage lien, even after your bankruptcy proceedings are completed.

The Good Outcomes or “Pros” of Chapter 13 Bankruptcy

While it usually takes longer for you to pay off your debts than many other forms of bankruptcy, Chapter 13 will allow you more time to make your payments, and trustees may be more flexible on the terms of your payments. You may also be able to stretch out your debt payments or reduce the amounts of your payments. You can sometimes even give up a piece of your property that you are making payments on to relieve some of the debt. Once you have successfully completed your repayment plan under Chapter 13, an individual creditor cannot obligate you to pay them in full.

While you are making your payments under Chapter 13 bankruptcy, you get to keep the property on which you are making payments.

Even though a Chapter 13 bankruptcy will stay on your credit record for years, it may be easier to explain the process to a future lender. A Chapter 13 bankruptcy is less harmful and easier to explain than missed debt payments, repossessions, or lawsuits, as it shows that you were trying your best to pay off your debts.

You lose access to your credit cards, but depending on your situation, those credit cards may be part of what got you into this mess in the first place. You might be able to obtain new lines of credit within one to three years of filing your bankruptcy, but with a much higher interest rate. It’s always important to be extremely careful with your credit card payments!

There are lenders out there who specialize in lending to ‘high risk’ people. That can be seen as an unfair characterization to make on someone who has taken a big step in solving his or her financial problems. Nevertheless, there is still an option for you, should you need to find a lender for something.

Even if you have gone through bankruptcy before, either with Chapter 13 or 7, if you obtained a Chapter 13 discharge in good faith by paying at least 70 percent of your unsecured debts, the six-year bar to file again does not apply.

If you do declare Chapter 13 bankruptcy now, you can get started sooner on rebuilding your credit. You can also always get a Chapter 13 plan if there is another disaster before you are entitled to file for Chapter 7. Basically, you can file Chapter 13 bankruptcy repeatedly, just remember that each filing will show up on your credit record and report.

To avoid harsh limitations against you for re-filing for bankruptcy, it is best to observe all court orders and rules as well as not ask to have your case dismissed if a creditor asks for relief from the stay. Remember, you are only prevented from re-filing for 6 months.

No matter your financial situation, it is always a good idea to at least consult with an attorney who specializes in these types of issues and see what your options are before you make a decision to file for any type of bankruptcy. If you have more questions about bankruptcy in the state of California, check out Dan Higson’s Chapter 13 bankruptcy page, or contact the Law Firm of Hathaway, Perrett, Webster, Powers, Chrisman & Gutierrez today! If you want more information on Chapter 7 bankruptcy, check out Dan Higson’s blog here.

Hathaway Perrett Webster Powers Chrisman & Gutierrez, APC is a debt relief agency pursuant to 11 U.S.C. 528(a)(4) and assists individuals, families, and businesses file for bankruptcy relief under the Bankruptcy Code.  This website is a communication under California Rule of Professional Conduct 1-400.  No legal relationship is created by the use of this website and no legal advice is provided.  No guarantee or warranty is provided that your case or matter will achieve any particular result and testimonials and endorsements provided on this site do not constitute a guarantee, warranty, or prediction about your matter or case. This communication is made on behalf of Hathaway Perrett Webster Powers Chrisman & Gutierrez, APC and DANIEL A. HIGSON, State Bar No. 71212 is responsible for its contents.  All information contained on this website may be factually substantiated by a credible source, including data from the United States Public Access to Court Electronic Records (PACER) system.  Detailed data and information is available on request.

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Gymboree Bankruptcy

Gymboree Bankruptcy

In what seems like a growing trend these last couple of years, another retail chain is starting the process of closing its doors. Children’s clothing store Gymboree filed for Chapter 11 bankruptcy protection in an attempt to escape from a mountain of debt. The clothing store first started up in in San Francisco in 1976, and at the time of filing on July 11, 2017, had a total of 1300 stores operating under its name as well as the “Janie and Jack” and “Crazy 8” chains.

What Happened?

The company, which had previously secured $308.5 million in financial help in order to keep its doors open, is following other retailers like Payless and JC Penney, who have also filed for bankruptcy recently. It’s believed that brick-and-mortar retailers are struggling due to a reduction in the amount of mall shoppers. More and more shoppers are getting their products online and spending less and less time in the store.

Gymboree’s new CEO, Daniel Griesemer, recently took over the company on May 22, 2017, and quickly started making some changes. The company announced that the chief financial officer was leaving the company and has asked the turnaround company AlixPartners to help it navigate the bankruptcy waters. In the meantime, one of Gymboree’s executives will serve as interim CFO.

Earlier this spring, the company let its investors know that they projected not having enough cash to get through the following 12 months. The Gymboree bankruptcy is being done to restructure the debt that the company holds.

What Now?

In filing for Chapter 11 bankruptcy, the retailer will seek to eliminate more than $900 million in debt from its balance sheet. According to the bankruptcy filings, the company, which was bought by Bain Capital in 2010 for $1.8 billion, has accumulated a staggering $1.4 billion in debt.

Along with the Gymboree bankruptcy filing, the company will close 375 of its stores in an attempt to respond to the changing amount of in-store customers. The company has stated that it could ultimately close as many as 450 of its total 1,281 stores, but will be running the remaining stores with business as usual for now. Griesemer claims that by going through this restructuring process, Gymboree will come out as a stronger and more competitive organization.

With the Gymboree bankruptcy in progress, its rival in the children’s clothing business, Children’s Place, took the smart route and started aiming their business online when they saw the early signs of slowing sales in retail store fronts. It will be interesting to see if Gymboree follows the lead of Children’s Place and many other retailers and starts work on making their online footprint bigger. If not, they may face more bankruptcy and store closures in the future.

To see which Gymboree stores are in your area and across the country, you can consult their website here.

If you want to read more about the recent trend that has a record number of stores closing across the country, check out Dan Higson’s blog on this “Retail Apocalypse.”

Hathaway Perrett Webster Powers Chrisman & Gutierrez, APC is a debt relief agency pursuant to 11 U.S.C. 528(a)(4) and assists individuals, families, and businesses file for bankruptcy relief under the Bankruptcy Code.  This website is a communication under California Rule of Professional Conduct 1-400.  No legal relationship is created by the use of this website and no legal advice is provided.  No guarantee or warranty is provided that your case or matter will achieve any particular result and testimonials and endorsements provided on this site do not constitute a guarantee, warranty, or prediction about your matter or case. This communication is made on behalf of Hathaway Perrett Webster Powers Chrisman & Gutierrez, APC and DANIEL A. HIGSON, State Bar No. 71212 is responsible for its contents.  All information contained on this website may be factually substantiated by a credible source, including data from the United States Public Access to Court Electronic Records (PACER) system.  Detailed data and information is available on request.

Wrongful Death Lawsuit in California: The Basics

Wrongful Death Lawsuit in California: The Basics

A wrongful death claim comes about when a person dies as the result of a wrongful act or negligence of another person or entity. What exactly does this mean? How does it get handled? What are the steps? We will go over all the basics of a wrongful death lawsuit below with a focus on the state of California.

What is a Wrongful Death Lawsuit?

If a wrongful death lawsuit is filed in the state of California, it will be a claim filed as a civil lawsuit. This means it is brought to court directly by any survivors of the deceased person or by the personal representative of the deceased person’s estate. Fault expressed in these claims is solely in terms of money damages, which the court orders the defendant to pay the deceased’s survivors if the lawsuit is successful. A few examples of common causes of wrongful death claims include vehicular accidents, medical malpractice, and liability due to faulty products.

These claims differ from criminal cases for homicide. A homicide case is brought by the state and could result in the guilty party being penalized with jail or prison time. A family in California could bring a civil wrongful death lawsuit to court even if there is already a criminal case going forward.

Who Can File a Wrongful Death Lawsuit in California?

There are only certain people who are allowed to file a wrongful death lawsuit. The California statute specifically allows these following parties to bring about a wrongful death lawsuit in civil court:

  • The deceased person’s surviving spouse.
  • The deceased person’s domestic partner.
  • The deceased person’s surviving children.

If there are no surviving people in the deceased’s line of family, then it is possible for a wrongful death lawsuit to be brought on by anyone ‘who would be entitled to the property of the decedent by intestate succession.’ This means that the people able to claim a wrongful death lawsuit can include the deceased person’s parents or siblings who were dependent upon them while they were alive. Should the person filing the claim be financially dependent upon the deceased person, there are also the following people who are allowed to bring about a wrongful death lawsuit:

  • The deceased person’s ‘putative spouse’ and children of that spouse.
  • The deceased person’s stepchildren.
  • The deceased person’s parents.

All of these statutes for people able to claim a wrongful death lawsuit are in the California Code of Civil Procedure section 337.60.

What Are the Damages Available in Wrongful Death Lawsuits?

There are several different types of personal injury damages that are considered in a wrongful death lawsuit in California. The specifics in amounts will depend on all of the factors of an individual case. The damages are usually divided according to how they compensate the estate for losses that are associated with the death or the surviving family members for the personal losses that they suffered as a result of the death in the claim.

The losses that are most attributed to the estate will include:

  • Funeral and burial expenses.
  • Lost income, including potential income that the deceased person would have been expected to earn in the future (within reason).
  • Medical and hospital bills for the deceased person’s final illness and/or injury.

Losses that are most attributed to surviving family members will include:

  • Loss of anticipated financial support.
  • The value of household services.
  • Loss of love, community, affection, moral support, and guidance.

What is the Time Frame to File a Wrongful Death Lawsuit?

As with other types of claims, there is a specific time period in which a family can file a wrongful death lawsuit. This is known as a statute of limitations. In California, the law requires a wrongful death lawsuit to be filed within two years of the date of the decedent’s death. If the case is not filed in the state’s civil court system within those two years, the family will most always lose the right to file it at all. ***Special Note:   A Medical Malpractice Wrongful Death matter has a ONE year statute of limitations.

No amount of money will ever bring back your loved one or make up for the heartache and loss, but a wrongful death lawsuit can help with the finances surrounding the death, and in most cases is a welcome relief. With these basics in mind, if you believe that the death of a loved one was caused by negligence or a wrongful act, it’s important to contact an experienced lawyer that can answer more of your questions and help you take the steps necessary to start the process of your wrongful death lawsuit. If you have further questions about filing a wrongful death lawsuit in California, contact the Law Firm of Hathaway, Perrett, Webster, Powers, Chrisman & Gutierrez today!

Hathaway Perrett Webster Powers Chrisman & Gutierrez, APC is a debt relief agency pursuant to 11 U.S.C. 528(a)(4) and assists individuals, families, and businesses file for bankruptcy relief under the Bankruptcy Code.  This website is a communication under California Rule of Professional Conduct 1-400.  No legal relationship is created by the use of this website and no legal advice is provided.  No guarantee or warranty is provided that your case or matter will achieve any particular result and testimonials and endorsements provided on this site do not constitute a guarantee, warranty, or prediction about your matter or case. This communication is made on behalf of Hathaway Perrett Webster Powers Chrisman & Gutierrez, APC and DANIEL A. HIGSON, State Bar No. 71212 is responsible for its contents.  All information contained on this website may be factually substantiated by a credible source, including data from the United States Public Access to Court Electronic Records (PACER) system.  Detailed data and information is available on request.