Modesto Bankruptcy Lawyer Blog

Nearly 13,000 people in the Eastern District of California, the area that includes Modesto, filed for bankruptcy in the second quarter of this year, about the same number to file in th first quarter.

Many people are seeing the benefits of filing bankruptcy in Modesto and how an experienced and knowledgeable Stockton Bankruptcy Attorney can help a consumer find their way to a more secure financial future.
According to statistics from the American Bankruptcy Institute, 12,976 people filed in the second quarter, a small increase from the 12,891 who filed during the first quarter. The Eastern District of California is the largest district in the state geographically, stretching from the Oregon border south through Sacramento, Stockton, Modesto, Fresno and down to Bakersfield. It stretches to the eastern border of the state.

The number of filings peaked during the second quarter of 2010, when 14,064 people filed for bankruptcy. But even the most recent numbers are far above those from 2006, when a total of 8,922 people filed for bankruptcy in this district for the entire year.

The Central District of California, which includes Los Angeles, Orange, Riverside, San Bernardino, Ventura, Santa Barbera and San Luis Obispo counties, leads filings every quarter given its population.

Many news outlets have reported how bankruptcy filings are down, but they remain steady in California because of high unemployment and a glut of foreclosures, which have weakened the local real estate market. As the large inventory of houses on the market rises, prices will continue to drop and people remain unemployed, foreclosures will rise. And the credit hit and possible deficiency judgement banks come after homeowners for will lead to bankruptcy filings. Bankruptcy immediately stops foreclosure.

While bankruptcy in the past has gotten a reputation as being bad for credit scores and tougher to get loans and credit, it can be quite refreshing for many people struggling with debt. What some people don't consider is that if they have late credit card and mortgage payments, their credit scores are probably poor anyway, so bankruptcy will give them a fresh start.

And Modesto Bankruptcy Attorneys have seen clients getting offers for credit cards and loans during and shortly after the bankruptcy process is complete. Lenders will want to provide loans because they'll know that the client has little or no debt left after going through the bankruptcy process.

The majority of people who file for bankruptcy file for Chapter 7 bankruptcy in Modesto. It provides a fresh start by discharging most debts, for those who qualify after passing a means test. Chapter 13 bankruptcy, filed by about 30 percent of people, allows consumers to keep major assets, such as a house with a lot of equity, vehicles or other large possessions, to set up a payment plan over 3 to 5 years.

Whatever the individual situation, setting up a free consultation is the first step. Analyzing the client's needs and determining the right path to take is how our firm stands out.