Legal Question in Bankruptcy in California

My daughter ran up a $27K credit card debt which she has reduced to around $20K. She has every intention of paying it off and is paying around $850 a month to retire the debt.

Now she's been told that starting in February, her minimum monthly payment will increase by 50%. There is no way she can do this. First of all, her hours at work were cut back to 35 hours. And even if she was working the full 40 hours a week, she still wouldn't be able to do it.

If the bank refuses to cooperate, what would happen if she filed bankruptcy? I know that the bankruptcy laws were changed to favor the banking industry over that of the consumer.

Would her debt be reduced substantially? Or would it be a waste of time to file?


Asked on 11/22/09, 8:33 am

2 Answers from Attorneys
Carl Starrett Law Offices of Carl H. Starrett II

The impact of the changes to the Bankruptcy Code made in 2005 have been greatly exaggerated. Your daughter should consult a local bankruptcy attorney, preferably a member of the National Association of Consumer Bankruptcy Attorneys. Chances are pretty good that she could file for Chapter 7 and totally eliminate her debts.

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Answered on 11/27/09, 8:53 am
Robert F. Cohen Law Office of Robert F. Cohen

A chapter 7 bankruptcy might eliminate most of her debts. A chapter 13 would pay off a percentage. It depends on for which chapter she would qualify. The bankruptcy "reform" imposed a means test to determine qualification.

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Answered on 11/27/09, 10:53 am


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