Secured vs. Unsecured Debt
Orange County Bankruptcy Attorney
The two main types of consumer bankruptcies are Chapter 7 and Chapter 13. When determining which bankruptcy is right for you it will be necessary to evaluate which types of debts you carry, as this will have a bearing on which chapter is best for your situation.
There are two types of debt to consider:
- Secured Debt: This type of debt is backed by a mortgage, a pledge of collateral, or another lien. The secured creditor has the right to take and hold or sell certain property such as a home or an automobile to satisfy some or a portion of debt owed.
- Unsecured Debt: This refers to any type of debt that is not collateralized by a lien on specific assets belonging to the borrower. For example, unsecured debt may include medical bills, credit card debt, personal loans and utility bills.
Discharging Debt through Bankruptcy
A bankruptcy discharge releases the debtor from personal liability for specific types of debts. Once a debt is discharged through a Chapter 7 or Chapter 13 bankruptcy, the debtor is no longer legally required to pay any of the debts that have been discharged. The discharge acts as a permanent order which prohibits the creditors from taking any form of collection action against the debtor on the discharged debts.
Chapter 7–or liquidation bankruptcy–is an excellent option for debtors who have a large amount of unsecured debt or old taxes. Debtors with a lot of medical bills or credit card debt may benefit dramatically from a Chapter 7 bankruptcy, especially since it allows qualifying debtors to erase or wipe out unsecured debt. On the other hand, debtors who are at risk of losing their home to a foreclosure may be better-served by a Chapter 13 bankruptcy, which allows them to keep their home and property as they make payments through a repayment plan.
Need help navigating the bankruptcy process? In order to determine which bankruptcy is right for you, it is crucial that you seek legal counsel as soon as possible. Contact us now to schedule a free initial consultation with an Orange County bankruptcy attorney from 1st California Law, Inc.
Amazing law firm to work with, very knowledgeable, & very kind. They made filing for bankruptcy easy. Kevin is a amazing lawyer, would definitely recommend to friends and family.- Evelyn V.
Kevin is the best! He made us feel at ease during a very stressful time in our lives. His upbeat personality and thorough explanations made this whole process effortless. His communication was on point and the cost for his services was absolutely reasonable. If I ever need legal service again in the future, he is my go to guy. Love him!- Elizabeth C.
Nobody ever hope to find themselves filing for bankruptcy but when I did, my first call with Kevin put me in such ease that I knew I found the right person to help me.- Leslie I.
Kevin was absolutely fantastic to work with. He made the entire process of filing my case approachable and much less stressful than I anticipated. He was responsive, professional, and direct throughout the entire process, and personally accompanied me at my hearing. I would highly recommend his services.- Ashley T.
Kevin Kunde was one of the best bankruptcy attorneys to work with. He was kind, informative, courteous and very knowledgeable. I would recommend 1st California Law and Kevin Kunde services to anyone seeking debt relief assistance. Bankruptcy can be a very scary situation and I through out the entire process I felt well guided and taken care of by 1st California Law. Thank you for everything.- Melissa L.
I recently filed for my Chapter 7 through Mr. Kevin’s law firm and I could not be happier with his services. All of my concerns and worries were eliminated when Mr. Kevin thoroughly explains the process of bankruptcy filing and court hearing. The actual court hearing is very simple and to the point, just as Mr.Kevin said. In all, i highly recommend Mr.Kevin as an attorney for anyone who is in need of financial debt relief. He is kind, transparent, and dedicated to his profession. I'm glad i have had a chance to work with Kevin.- Bruce
It was the best experience ever with Kevin, I consulted several attorneys regarding my bankruptcy before I went to Kevin, and Kevin was very helpful and also the fees is very good. It was so easy to prepare my filling with him and he kept me updated with everything and tell me everything I need to know even if I didn't ask for it. Kevin show up with me in court and he was very helpful in getting over this stressful situation easily and smoothly, highly recommended him and his office if you look for any financial relief advice or help. Thanks Kevin.- AA
I'm 100% satisfied with his service I highly recommend to anyone!- Vivian
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