Sherman Oaks Chapter 7 Bankruptcy Lawyer
The letters keep arriving, the calls start before nine, and a wage garnishment or a collection lawsuit is now on the calendar. For many people in the San Fernando Valley, that pressure is what finally leads them to search for a Sherman Oaks Chapter 7 bankruptcy lawyer. Wadhwani & Shanfeld is a consumer bankruptcy and debt relief law firm that handles Chapter 7, Chapter 13, debt settlement, foreclosure defense, wage garnishment, and creditor lawsuits for individuals and families in Sherman Oaks and across Los Angeles, Orange, Riverside, and San Bernardino Counties.
Chapter 7 is the filing that wipes out qualifying unsecured debt: credit cards, medical bills, personal loans, payday loans, and deficiency balances left after a repossession. Most cases wrap up in roughly four months. The moment the petition is filed, the automatic stay orders creditors to stop. Garnishments, bank levies, lawsuits, and collection calls all halt, often before the next paycheck is touched.
The filing is also less drastic than its nickname, “liquidation,” suggests. Most of our clients keep everything they own, because California’s exemption rules protect a great deal more than people expect.
Why Sherman Oaks Clients Choose Wadhwani & Shanfeld for Chapter 7
Wadhwani & Shanfeld has helped more than 30,000 individuals and families get out from under debt, and the firm is led by two Board-Certified Specialists in Consumer Bankruptcy through the American Board of Certification. Together the team brings more than 90 years of combined legal experience to Chapter 7 cases for clients in Sherman Oaks, the San Fernando Valley, the Westside, and throughout Southern California. Clients get direct access to an attorney from the first call, a free consultation, and the choice of meeting in person or handling the whole case by phone, email, video, or online chat. Virtual consultations are available to anyone who prefers not to travel.
Raj Wadhwani, founding shareholder and partner, graduated from Southwestern Law School. He helped pilot the Best Case Bankruptcy software in 1998 and was the first attorney to file a bankruptcy case electronically in the Central District of California. Greg Shanfeld, founding shareholder and partner, earned his law degree from the University of Southern California and has handled more than 10,000 bankruptcy cases over three decades. Both hold board certification in consumer bankruptcy, a distinction few attorneys in the country earn.
That depth matters in a Chapter 7 because the outcome often turns on small decisions: which exemption system to use, how to treat a car loan, whether a recent payment to a relative creates a problem. The firm files in every division of the U.S. Bankruptcy Court for the Central District of California, and it acts quickly when a garnishment, foreclosure sale, or repossession is only days away. Our Sherman Oaks bankruptcy attorneys also tell you plainly when Chapter 7 is not the right tool and a Chapter 13 or a negotiated settlement would serve you better.
Debts and Situations That Lead Sherman Oaks Residents to File Chapter 7
- Credit Card Balances: Cards carried for years on minimum payments, often after a job loss or a cut in hours, are the most common debt Chapter 7 erases. Once the case is filed, the balances are eliminated and the collection calls stop.
- Medical Bills: An illness or surgery can produce bills that dwarf a household budget. These are unsecured debts and are generally dischargeable, including accounts already sent to collections.
- Collection Lawsuits and Judgments: Once a creditor sues, the case can end in a judgment that leads to garnishment or a bank levy. Filing Chapter 7 stops the suit or the enforcement and can eliminate the underlying debt.
- Wage Garnishment: On an ordinary judgment, a creditor can take up to 20% of weekly disposable earnings, subject to a second limit tied to the minimum wage. Chapter 7 stops most garnishments the day the case is filed.
- Personal and Payday Loans: High-interest loans that snowball are unsecured and usually dischargeable, which ends the cycle of borrowing to cover the last loan.
- Repossession Deficiencies: When a repossessed car sells for less than the loan balance, the lender can pursue the difference. That deficiency is an unsecured debt that Chapter 7 can wipe out.
- Older Income Tax Debt: Some income taxes can be discharged if they meet specific timing rules. Recent taxes and most other tax obligations usually cannot.
- Debts Chapter 7 Cannot Reach: Child support, alimony, most student loans, most government fines, and debts from drunk-driving injuries generally survive, so these need a separate strategy.
What to Do Right Now If You Are Considering Chapter 7 in the San Fernando Valley
Start by gathering the paperwork: recent pay stubs, the last two years of tax returns, bank statements, a list of every creditor, and anything you have received from a collector or a court. Do not skip the debts you are embarrassed about. A complete list is what makes the discharge hold.
If you have been served with a lawsuit, the response deadline is the date that matters most. In California, an expired limitations period is a defense, but it must be raised in a written answer, or the court can still enter judgment. A suit on a written contract or book account generally must be filed within four years; an oral contract, within two. A payment on an old, time-barred debt does not revive it, and only a signed written acknowledgment restarts the clock. Call before the deadline passes so we can decide whether to answer, negotiate, or file.
If a sale date or garnishment is imminent, say so in the first call. A foreclosure sale in California cannot be set until roughly three months and 20 days after the notice of default is recorded, and the borrower generally can reinstate by paying the arrears until five business days before the sale. On a repossession, the lender must give at least 15 days’ written notice before disposing of the car, and you can ask in writing for a 10-day extension of the redemption period. Those windows are short, and a Chapter 7 filing can freeze them.
Before filing, avoid moving assets, repaying relatives, or running up cards in the weeks beforehand. Those moves can draw a trustee’s attention and put your discharge at risk. Also be careful about cash and bank accounts: a levy can drain an account, though California automatically shields a limited amount in a deposit account without a claim of exemption.
Most Sherman Oaks residents file in the San Fernando Valley Division of the U.S. Bankruptcy Court, which sits in Woodland Hills. The division is assigned by the zip code of your street address, and we confirm that for you before filing. A Chapter 7 case also includes the meeting of creditors, where a trustee asks brief questions about your paperwork. We prepare you for it and appear with you.
Means Test and Exemptions: Who Qualifies and What You Keep
To file Chapter 7, your household income generally must pass the means test, which compares your income to the California median for a household of your size and then accounts for your actual allowed expenses. The median figures are adjusted periodically, so we run the current numbers with you rather than guessing. If your income is too high, Chapter 13 is often the alternative, and we will explain which fits.
California has opted out of the federal exemption list. Instead, you choose one of two state systems and must use it for the entire case. The first, found in the Code of Civil Procedure’s section 704 series, protects home equity through a homestead exemption that scales with local home prices and is adjusted for inflation each year. The second, under section 703.140(b), has smaller, fixed amounts for a home and a vehicle plus a wildcard that can cover almost any asset, which often suits renters or people with little equity. To use California’s exemptions, you must have lived in the state for at least 730 days.
Choosing between them is one of the most consequential decisions in the case. A homeowner with real equity in Sherman Oaks usually wants the homestead system. A renter with a paid-off car and modest savings often does better with the wildcard. Our board-certified attorneys work through both before filing, so you know what is protected before the petition is signed.
After You File: Discharge, Credit, and Your Paycheck
Once the discharge is entered, the covered debts are gone for good and creditors cannot collect them. A Chapter 7 can stay on your credit report for up to 10 years from filing, but its effect fades well before then. Many clients see scores begin to recover in the first year by using a secured card responsibly and paying every bill on time.
If wages were being garnished, the garnishment ends with the stay. Your employer is not automatically told about the filing, and California law bars an employer from firing you because wages were garnished for a single judgment. Federal and California law also prohibit firing you solely for filing bankruptcy.
Sherman Oaks Chapter 7 Bankruptcy Questions
How long does a Chapter 7 case take?
Most cases are completed in roughly four months from filing to discharge. The timeline can stretch if a creditor objects or a trustee needs additional documents, which is why accurate paperwork at the start matters.
Will I lose my house or car in Chapter 7?
Most of our clients keep both. For a home, the question is whether your equity falls within California’s homestead exemption and whether you are current on the mortgage. For a car, the question is whether the equity is protected under the exemption system we choose.
What debts can Chapter 7 eliminate?
Most unsecured debt: credit cards, medical bills, personal loans, payday loans, and deficiency balances after a repossession or foreclosure. Some older income taxes qualify too. Child support, alimony, most student loans, and most government fines generally do not.
How quickly does filing stop a garnishment or lawsuit?
Immediately. The automatic stay takes effect the moment the petition is filed, and creditors must stop collection. In an emergency we can often prepare and file quickly to stop a levy or sale.
How do I know if I qualify under the means test?
The test compares your household income to the California median for your household size, then looks at your allowed expenses. If you fall above the line, Chapter 13 may still work. We run both calculations at the free consultation.
Can I file Chapter 7 if I filed before?
Yes, subject to waiting periods. You generally must wait 8 years between Chapter 7 filings, 4 years to file Chapter 13 after a Chapter 7, and 6 years to file Chapter 7 after a Chapter 13, though that last period can be shortened if the plan paid enough to unsecured creditors.
The collector says the debt is too old to sue over. Do I still need to respond to a lawsuit?
Yes. California gives four years on written contracts and book accounts and two years on oral contracts, but the expired deadline is a defense you must raise in a written answer. If you ignore the suit, the court can still enter a judgment.
If a creditor already has a judgment against me, can bankruptcy help?
Often, yes. A California money judgment is enforceable for 10 years and can be renewed, but filing Chapter 7 stops enforcement and can discharge the debt behind it. Bank levies and garnishments tied to that judgment halt when the case is filed.
Is a bank levy a problem if I file Chapter 7?
The stay stops new levies. California also automatically protects a set amount in a deposit account from a levy without a claim of exemption, though that protection does not cover levies for child or spousal support or debts owed to the state.
Can a collector be held accountable for harassment?
California’s Rosenthal Act applies to original creditors as well as collection agencies. A consumer can recover actual damages, an additional $100 to $1,000 for willful violations, and attorney fees, but suit must be brought within one year. We can review whether a collector crossed the line while we resolve the debt itself.
Is it worth hiring a lawyer instead of using a petition preparer?
A preparer can type your information into forms but cannot give legal advice, choose your exemptions, or represent you if a trustee or creditor raises a problem. A mistake can cost you property or the discharge, and that is the risk board-certified representation is meant to remove.
Do I have to come into an office?
No. We handle cases fully by phone, email, video, and online chat, and offer 100% virtual consultations. Clients who prefer to meet in person are welcome to do so.
Serving Sherman Oaks Chapter 7 Clients and the Rest of Southern California
We represent clients throughout Sherman Oaks and the surrounding San Fernando Valley, including Van Nuys, Encino, Woodland Hills, Reseda, Northridge, Granada Hills, North Hollywood, North Hills, Mission Hills, San Fernando, and Sylmar. Westside and central communities such as Hollywood and Santa Monica are part of our reach, along with Los Angeles proper, Santa Clarita, Torrance, Compton, Inglewood, Long Beach, and Lakewood.
Across Los Angeles County we also serve the Antelope Valley, including Lancaster, Palmdale, and Acton, and communities such as Norwalk, Bellflower, Paramount, Gardena, Cerritos, Cypress, Signal Hill, and Huntington Park. In the Inland Empire, our clients live in Ontario, Rancho Cucamonga, Upland, Fontana, San Bernardino, Pomona, Chino, Chino Hills, Montclair, Claremont, Glendora, West Covina, Riverside, and the Coachella Valley. In Orange County, we serve Anaheim, Santa Ana, Garden Grove, Buena Park, Fullerton, Huntington Beach, Westminster, Costa Mesa, Newport Beach, Tustin, La Habra, Placentia, Mission Viejo, and Laguna Niguel.
Talk to a Sherman Oaks Chapter 7 Bankruptcy Attorney Today
You do not have to wait for the next garnishment notice or court date to get answers. A Sherman Oaks Chapter 7 bankruptcy attorney at Wadhwani & Shanfeld can review your income, property, and debts, tell you whether Chapter 7, Chapter 13, or a settlement fits best, and explain exactly what you would keep. Call for a free consultation and speak directly with an attorney, in person or from your own living room.
