What is Bankruptcy?
What are the Consequences of having Unpaid Debt?
What are the Advantages of Bankruptcy?
Available Chapters


Automatic Stay 

          Filing for bankruptcy triggers an Automatic Stay which puts an immediate stop to all the debt collection efforts, including lawsuits, evictions, repossession, and foreclosure efforts. The purpose of this Automatic Stay is to stop the debt-collection agencies from collecting debtor’s assets. As soon as you retain our service at Cero Balance, Inc., we immediately contact your Creditors to let them know you will be filing for bankruptcy and to cease the harassing phone calls. Furthermore, if your wages are being garnished, the Automatic Stay will stop the wage garnishment and the bankruptcy process may possibly eliminate the debt that triggered the wage garnishment in the first place. 

Discharge Most Unsecured Debt

          The most common reason people file for bankruptcy is to discharge or eliminate their unsecured debts. An unsecured debt is a debt that is not protected by a lien against an asset, such as a home or a car. Most debts owed by a debtor in a Chapter 7 consumer bankruptcy case are typically unsecured debts, with the exception of those who own a home or a car, which are secured debts. While not all unsecured debts can be discharge through bankruptcy, many unsecured debts, such as doctor’s bills, credit cards, and in some instances, second mortgages, can be completely eliminated through bankruptcy.

The Right to Keep Exempt Property

          In addition to eliminating most unsecured debts, the bankruptcy process allows debtors to keep certain exempted property. Depending on the value and amount of property you own, bankruptcy may allow you to keep all of your properties, including your home, car, and household furnishings. In California, there are two sets of exemptions the debtor may choose from, so depending on the type of property you own we will choose the set of exemptions that allow the debtor to keep most, if not all, of their property. At Cero Balance, Inc., we work with our clients to fully understand his or her financial situations and personal goals to determine which set of exemptions will allow our clients to receive the maximum benefits from the bankruptcy process, including keeping the most property and eliminating the most unsecured debts as possible.

A Financial Fresh Start

          By eliminating certain unsecured debts while still allowing debtors to keep their exempt property, bankruptcy provides debtors with a financial fresh start. Bankruptcy gives the debtor an opportunity to start rebuilding his or her credit. Although it can take some time for a debtor to rebuild their credit after filing for bankruptcy, by eliminating most debts through the bankruptcy process, debtors are in a much better position to start improving their credit after bankruptcy.





Chapter 7

          This is a liquidation bankruptcy, sometimes called “straight bankruptcy”. The principle advantage is that the debtor comes out without any future obligations on his discharged debts. The law allows the debtor to have a "Fresh Start." In most Chapter 7 Bankruptcy cases, the debtor receives a discharge releasing him or her from personal liability for certain dischargeable debts. Debtor should consider a Chapter 7 Bankruptcy if there is no hope in repaying any of his or her debts, there are no cosigners involved, or if court action by creditors is imminent.

          A chapter 7 debtor is seeking a discharge of his obligations to pay his debts. However, bankruptcy does not discharge or wipe out most taxes, student loans, child support or alimony (called domestic support obligations in the bankruptcy code), and a variety of other debts. The key word is "most taxes and most student loans". Contact us and we will explain to you during your free consultation whether your student loans and or taxes are likely to be discharged or not. One of the primary reasons that people choose a chapter 7 bankruptcy is that a person can work on improving his or her credit score much more quickly than if he or she filed a Chapter 13 Bankruptcy. This is the case because he or she can complete the bankruptcy case fairly quickly. Please Contact us for a free consultation with one of our attorneys. 

Chapter 11

          Chapter 11 is the chapter used by large businesses to reorganize their debts and continue operating. Corporations, partnerships, and limited liability companies cannot use chapter 13 to reorganize and must cease the business operations if a chapter 7 bankruptcy is filed. Chapter 11 cases are by far the most complicated of bankruptcy cases, and as a result, there are very few law firms that handle chapter 11 cases, but often times individuals and companies cannot obtain the relief they need under chapter 7 or chapter 13, thus a chapter 11 is their best option. Please Contact Us for a Free consultation with one of our attorneys. 

Chapter 12

          Chapter 12 is the chapter used by farmers or commercial fishermen to reorganize their debts and continue operating their farms or fishing operations. The advantage of Chapter 12 is that the financial reorganization plan will allow payments to be made seasonally when the farmer or fisherman earns his money. The limitation of only being able to restructure loans in a five-year duration in chapter 13 cases is not limited in chapter 11 or chapter 12 cases. Please Contact Us for a free consultation with one of our attorneys.

Chapter 13

          A Chapter 13 bankruptcy allows the debtor to create a repayment plan to repay some or all of their debts over a three to five year duration. If a debtor makes too much money to qualify for a Chapter 7 under the "means test", a Chapter 13 their only option for filing bankruptcy. It may also be the best option for certain debtors, including:

- Debtors behind on their mortgage and or car loans
- Debtors with consistent income
- Debtors with debts that cannot be discharged through a Chapter 7 (for example, tax debts or student loans)
- Debtors who want to keep certain property that would have been a non-exempt in a Chapter 7 bankruptcy (for example, a home with too much equity).


          Bankruptcy is a Federal Law designed to help qualified individuals who cannot pay his or her bills to get a fresh financial start through liquidation or a new repayment plan. It is a legal proceeding that is carried out by the debtor when he or she can no longer afford to pay his or her debt to Creditors. Filing Bankruptcy alone, without an appropriate legal team can result in significant financial  disadvantages to you. Our experienced Attorneys and staff can provide you with a successful and efficient legal process of filing a Bankruptcy case. 

         If you are gravely behind on your credit card payments, you will be charged with late fees, penalty fees, and increased APR rate. In addition to the above consequences, your credit score will plummet and your debt will be transferred to a debt-collection agency. These debt-collection agencies' main goal is to collect the debt you owe through various means such as sending you letters, calling, texting, and emailing you. The extent of the seriousness in this matter can go as far as them filing a lawsuit against you. If the lawsuit is successful and a court order has been obtained, they can then target your paychecks, this is also known wage garnishment. Wage garnishment is when these debt-collecting agencies take a percentage out of each and every single one of your paychecks to pay off your debt. In addition to wage garnishment, they can also target the money that is in your bank account. Don't get stuck in the midst of all these financial struggles, get a free consultation with one of our Attorneys and secure your and your family's future.