If you’re feeling overwhelmed by debt, you’re not alone. Many people across the San Fernando Valley find themselves buried under credit card balances, medical bills, or personal loans they can’t repay.
Chapter 7 bankruptcy offers a legal path to wipe the slate clean. But it’s not as simple as filing paperwork and walking away debt-free—you need to understand the steps, the requirements, and what to expect along the way.
At Janus Law, we walk clients through the Chapter 7 process every day. Here’s a straightforward breakdown of what filing for Chapter 7 bankruptcy actually looks like in the San Fernando Valley.
What Chapter 7 Can and Can’t Do
Chapter 7 bankruptcy is commonly referred to as liquidation bankruptcy. It allows you to eliminate most unsecured debts—think credit card balances, payday loans, and medical bills. In exchange, the court may require you to sell nonexempt property to repay part of what you owe. The good news is that California has generous exemption laws that allow most people to keep all or most of their property.
Here’s what Chapter 7 can do:
- Discharge eligible unsecured debts
- Stop collection calls and wage garnishments
- Pause foreclosure proceedings (at least temporarily)
But there are limits.
Chapter 7 won’t erase:
- Student loans (in most cases)
- Recent tax debts
- Child support or alimony obligations
You also need to qualify based on your income. If you earn too much, you may have to consider Chapter 13 instead.
The Means Test
The means test is a formula used to determine whether your income is low enough to file for Chapter 7 bankruptcy. In California, the test compares your average monthly income over the past six months to the state median for a household of your size.
If your income is below the median, you’re likely in the clear. If it’s above, you’ll need to dig deeper—subtracting allowed expenses (such as housing, food, and transportation) to see if you still qualify.
Here’s how it works:
- Step 1: Gather six months of income documentation, including wages, gig work, and any side income.
- Step 2: Compare your income to the California median. As of this writing, the median income for a household of two is around $99,000 per year.
- Step 3: If you’re above the threshold, complete the second part of the test, factoring in your necessary monthly expenses.
Failing the means test doesn’t mean you’re out of options. It simply means you might need to pursue a different bankruptcy chapter, like Chapter 13. But many people in the San Fernando Valley pass the means test, especially if they’ve recently lost income or faced unexpected financial hardship.
Filing Chapter 7 in the San Fernando Valley
Once you’ve confirmed your eligibility, the next step is filing your case in the proper California bankruptcy court.
Here’s what the filing process includes:
- Credit Counseling: You must complete a court-approved credit counseling course within 180 days before filing.
- Petition and Schedules: This is where you list your income, assets, debts, and recent financial transactions. It must be accurate and complete.
- Filing Fee: The court charges a filing fee, though payment plans or fee waivers may be available.
- Automatic Stay: Once you file, an automatic stay goes into effect. This halts collections, garnishments, and lawsuits.
Timing is important. Filing too soon (or too late) can impact your ability to protect assets or discharge certain debts. That’s why working with a knowledgeable bankruptcy attorney matters—especially in a region as complex as the San Fernando Valley, where real estate values and property concerns can affect exemption strategy.
What Happens After You File?
Filing your bankruptcy petition is only the beginning. After that, your case will go through several key steps before it’s complete:
341 Meeting (Meeting of Creditors): Roughly 3 to 5 weeks after filing, you’ll attend a short meeting with your court-appointed bankruptcy trustee. Creditors can attend, though they rarely do. You’ll answer basic questions under oath about your financial situation. This meeting takes place over Zoom in the San Fernando Valley post-COVID.
Trustee Review and Asset Determination: If all your property is protected by California exemptions, the trustee will likely declare your case a “no asset” case, meaning creditors won’t get anything. If there are nonexempt assets, the trustee may sell them to pay down part of your debt. However, most Chapter 7 filers don’t lose anything—especially with proper planning.
Debtor Education Course: Before receiving a discharge, you’ll need to complete a second online course: financial management or debtor education.
Discharge of Debts: Typically about four months after filing, you’ll receive your official discharge order in the mail. This court document wipes out your eligible debts and legally releases you from further obligation.
At this point, the case is closed, and you can move forward without the burden of past-due balances weighing you down.
Get the Support You Need
Bankruptcy isn’t a moral failure—it’s a legal tool designed to give you a second chance. If you’re considering Chapter 7 bankruptcy in the San Fernando Valley, you don’t have to navigate the process alone.
At Janus Law, we help individuals and families protect what matters most and start fresh with confidence. From analyzing your eligibility to walking you through the entire process, our team is here to guide you every step of the way.
Ready to take the first step? Contact our office located in the San Fernando Valley right now to schedule a confidential consultation. Let’s talk about how we can help you rebuild your financial future.
- The Chapter 7 Bankruptcy Process in the San Fernando Valley - July 19, 2025
- What to Expect in the Chapter 7 Bankruptcy Process - July 16, 2025
- What Assets are Exempt from Chapter 7? - June 16, 2025
Schedule An Appointment
Talk to a Bankruptcy Attorney Right Now
Call Now to Schedule An Appointment
Other Tips
What to Expect in the Chapter 7 Bankruptcy Process
What Assets are Exempt from Chapter 7?
