Released on: February 13, 2008, 11:19 am

Press Release Author: Richard A. Brownstein

Industry: Law

Press Release Summary: Bankruptcy is still an available option to most Americans in
financial difficulty. Creditors can be stopped, and foreclosures can be prevented.
Bankruptcy is not dead. In fact, today, most Americans in financial difficulty can
still use the Bankruptcy Courts for protection. There are two ways to establish your
eligibility for a Chapter 7 Bankruptcy.

Press Release Body: In 2005, when Congress made sweeping changes to the Bankruptcy
Code, they left virtually unscathed the Chapter 13 Bankruptcy provisions designed to
save a home from foreclosure. Today, in the face of massive foreclosures, many
families are unaware that Chapter 13 Bankruptcy may still be used to prevent
foreclosure.

There are three different types of Bankruptcy that are generally available to
individuals:

Chapter 7 Bankruptcy (sometimes referred to as a liquidation) is the most common.
In this Bankruptcy qualified individuals are allowed to discharge most of their
unsecured debt in exchange for allowing their non-exempt assets to be liquidated by
a Trustee.

Chapter 11 Bankruptcy (sometimes referred to as a business reorganization) is
expensive and typically reserved for business or individuals with substantial assets
and substantial income. Chapter 11 allows debtors to reorganize their debt and pay
their creditors over time. The amount that they pay depends upon the value of their
non-exempt assets. The amount of time allowed is based upon current and projected
income.

Chapter 13 Bankruptcy (sometimes referred to as a wage earner's reorganization) is
relatively inexpensive and exclusively for individuals with the ability to pay
certain required obligations within a three to five year period. The amount that
needs to be paid over a three to five year period is determined by the value of
non-exempt assets, the amount of certain non-dischargeable debts, and current
income.

Chapter 13 Bankruptcy allows property owners who are delinquent on their mortgage
payments to abruptly stop foreclosure proceedings. This is true for any type of
Bankruptcy filing, up to the day before the foreclosure sale. But Chapter 13 is
uniquely structured to allow the property owner to pay the delinquency in equal
monthly installments over as much as sixty months (the PLAN). So long as the PLAN
complies with the technical requirements of the Bankruptcy Code, there is no need to
get the lender's agreement to the PLAN.

It is true that Chapter 13 Bankruptcy has rather stringent qualifications, including
total amount of debt and income. It requires a competent Bankruptcy Lawyer to
analyze the specific debt and income facts to determine if the property owner
qualifies. But assuming a property owner can meet these qualifications, Chapter 13
provides a mechanism for them to stop the foreclosure and protect their property for
five years ... or at least until they can find a buyer at a reasonable price.

Time is the primary benefit. Chapter 13 will provide the time needed to ride out
the current emergency.

Richard A. Brownstein
Brownstein and Brownstein LLP
21700 Oxnard Street, Suite 1160
Woodland Hills, CA 91367
Tele: 818 905-0000
rb@brownsteinllp.com

Richard R. Brownstein is one of only 105 lawyers in the State, Certified by the
California Bar Association,
Board of Legal Specialization as a Bankruptcy Specialist.


Web Site: http://www.brownsteinllp.com

Contact Details: Richard A. Brownstein
Brownstein and Brownstein LLP
21700 Oxnard Street, Suite 1160
Woodland Hills, CA 91367
Tele: 818 905-0000
rb@brownsteinllp.com