Pasadena Bankruptcy Lawyer
A court summons from a collection firm, a paycheck that suddenly comes up short, or a foreclosure notice taped to the door tends to arrive without warning, and Pasadena households often find themselves weighing bankruptcy for the first time. Wadhwani & Shanfeld is a consumer bankruptcy and debt relief law firm that handles Chapter 7, Chapter 13, debt settlement, foreclosure defense, wage garnishment, creditor lawsuits, and IRS tax debt for clients in Pasadena and across Los Angeles County and Southern California.
Finding a Pasadena bankruptcy lawyer usually starts with a narrower question than “should I file.” People want to know whether the lawsuit they were served with can be stopped, whether a garnishment can be lifted, whether the house is safe, and whether bankruptcy is even the right tool. Those questions have specific answers under California and federal law, and the sections below work through them in the order most readers need them.
Why Choose Wadhwani & Shanfeld for Bankruptcy Help in Pasadena
Wadhwani & Shanfeld has helped more than 30,000 individuals and families resolve debt, and the firm is led by two Board-Certified Specialists in Consumer Bankruptcy through the American Board of Certification: founding shareholders Raj Wadhwani and Greg Shanfeld. Together the firm’s lawyers carry more than 90 years of combined legal experience. Raj Wadhwani, a Southwestern Law School graduate, 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 earned his law degree from the University of Southern California and has handled more than 10,000 bankruptcy cases over three decades.
For a Pasadena client, those credentials translate into practical things. The firm files in every division of the U.S. Bankruptcy Court for the Central District of California, so the question of which division handles your case is routine work rather than a hurdle. You reach an attorney directly from your first call, the firm acts quickly when a garnishment, foreclosure sale, or repossession is days away, and the first consultation is free. Cases can be handled entirely by phone, email, video, and online chat, and 100% virtual consultations are available, which helps when you cannot take time off work to sit in a lobby.
The firm also handles the alternatives. Debt settlement, loan modification, second mortgage settlements, IRS tax representation, student loan strategies, and small business debt solutions all sit alongside Chapter 7 and Chapter 13, so a recommendation comes from comparing real options for your income, property, and goals. Whether you need a Pasadena bankruptcy attorney for a full filing or just an honest opinion that bankruptcy is not necessary, the advice is built around your situation.
Debt Situations That Lead Pasadena Residents to File
- Collection Lawsuits on Credit Cards and Personal Loans: Suits over unpaid cards and loans move on a short response clock, and a judgment can lead to wage garnishment or a bank levy. Filing a bankruptcy petition triggers the automatic stay, which halts the suit and the collection steps that follow.
- Wage Garnishment: On an ordinary judgment, a garnishment is capped at the lesser of 20% of weekly disposable earnings or 40% of the amount by which those earnings exceed 48 times the minimum hourly wage. Chapter 7 or Chapter 13 stops most garnishments once the case is filed.
- Medical Bills: Unsecured medical debt is generally dischargeable in Chapter 7, which makes bankruptcy a realistic path after a hospitalization or long illness that outran insurance.
- Mortgage Default and Foreclosure: Chapter 13 lets homeowners stop a scheduled sale and spread missed payments over three to five years, and in some cases strip off a wholly unsecured second mortgage.
- Car Repossession and Deficiency Balances: A lender must give written notice before disposing of a repossessed vehicle, and any deficiency left afterward is unsecured debt that bankruptcy can usually eliminate.
- IRS and Older Income Tax Debt: Some older income taxes can be discharged if they meet specific timing rules, while priority tax debt can be paid through a Chapter 13 plan or addressed through IRS representation outside of court.
- Student Loans: Most student loans cannot be discharged in bankruptcy, but the firm works on student loan debt strategies, and clearing other debts often frees income to manage the loans.
- Small Business Debt: Self-employed Pasadena owners and small business operators who personally guaranteed debts can pursue bankruptcy or other business debt solutions.
What to Do Right Now if Creditors Are Closing In
Start with whatever has a date on it. If you were served with a summons, the response deadline is the first thing to protect, because an expired limitations period is a defense you must raise in a written answer, and a court can still enter judgment against someone who stays silent. The time limit to sue on a written contract or book account is four years, and on an oral contract it is two. A payment on a debt that is already time-barred does not revive it, and only a signed written acknowledgment restarts the clock, so be careful about what you sign or say to a collector on an old account. Civil suits from Pasadena addresses are heard at the Pasadena courthouse of the Los Angeles County Superior Court, and bring the summons with you to your consultation.
If a foreclosure is underway, read the dates on the notices. A sale cannot be set earlier than three months and 20 days after the notice of default is recorded, the notice of sale must be mailed and posted at least 20 days before the sale, and a monetary default can be reinstated until five business days before the sale. Those windows are where options live, including Chapter 13. For a repossession, the lender must send at least 15 days of written notice before disposing of the vehicle, and you can ask in writing for the redemption period to be extended by 10 days. A deficiency claim is only valid if the proper notice went out within 60 days of repossession.
Gather your recent pay stubs, a list of every creditor and balance, statements for any secured loans, your most recent tax return, and every letter or court paper you have received. The bankruptcy court assigns your case by the street address of your home, not a P.O. box, and a Pasadena filer’s division is confirmed through the court’s locator tool. The Central District of California covers Los Angeles, Orange, Riverside, San Bernardino, Santa Barbara, Ventura, and San Luis Obispo Counties. In this process, the common mistakes are ignoring a summons, paying a collector on an old debt hoping to settle, moving money to relatives before filing, and using a form-preparer who cannot give legal advice or defend you if a trustee raises an objection.
Keeping Your Home, Car, and Savings Under California Exemptions
The fear that keeps people from calling is usually losing property, and California’s rules are more protective than most expect. California has opted out of the federal exemptions, so a filer chooses one of two state systems for the entire case: the standard system, with a substantial homestead exemption suited to homeowners with equity, or the alternative system, whose wildcard often works better for renters and people with little home equity. You must also have lived in California long enough to use the state’s exemptions, which is 730 days. Our Los Angeles area bankruptcy attorneys choose between the systems deliberately, because that decision shapes the whole outcome.
The homestead exemption is tied to the prior-year countywide median single-family home price, within a floor and a ceiling that adjust annually for inflation. In Los Angeles County, with its high median home prices, that often covers a homeowner’s equity in full. Vehicles, household goods, tools of the trade, and retirement accounts also receive protection. Bank accounts are shielded in part as well: a statutory deposit-account exemption applies automatically when a bank is served with a levy, though it does not apply to levies for support or debts owed to the state.
Chapter 7 or Chapter 13: Choosing the Right Filing
Chapter 7 wipes out qualifying unsecured debt, usually within about four months, and is available when your household income passes the means test, which compares your income to the California median for your household size and then considers your actual expenses. It fits people with limited income, mounting collection calls, and large unsecured balances. Despite the “liquidation” label, most of our clients keep everything they own.
Chapter 13 suits people with steady income who need time. Your debts are reorganized into one monthly payment over three to five years, creditors are bound once the court confirms the plan, and the filing is often the right call when you are behind on a mortgage or car loan, earn above the Chapter 7 limits, or owe priority tax or support arrears that Chapter 7 cannot erase. There are also waiting periods if you have filed before: 8 years between Chapter 7 cases, 4 years from a Chapter 7 to a Chapter 13, 2 years between Chapter 13 cases, and generally 6 years from a Chapter 13 to a Chapter 7.
Pasadena Bankruptcy Questions, Answered
How fast does bankruptcy stop a lawsuit or garnishment?
The automatic stay takes effect the moment the petition is filed, and creditors must stop collection activity, including lawsuits, wage garnishments, bank levies, repossessions, and foreclosure proceedings. In an emergency, the firm can often prepare and file quickly to stop a sale or levy.
Will I lose my house if I file?
Most clients keep their homes. In Chapter 7, the question is whether your equity falls within California’s homestead exemption and whether you are current on the mortgage. If you have more equity than the exemption covers or you are behind on payments, Chapter 13 can protect the home while you catch up.
Which debts cannot be wiped out?
Child support, alimony, most student loans, most government fines, and debts for injuries caused by drunk driving generally survive. Credit cards, medical bills, personal loans, payday loans, and deficiency balances after repossession or foreclosure can generally be discharged.
Do I have to qualify for Chapter 7 through the means test?
Yes, if you want Chapter 7. The test compares your household income with the California median for your household size, then accounts for allowed expenses. If you fall above the line, Chapter 13 or a non-bankruptcy solution is usually the path.
Will my employer find out I filed?
Not automatically. They could learn if they are a creditor, if a garnishment must stop, or if Chapter 13 payments are deducted from your paycheck. California and federal law prohibit an employer from firing you solely because you filed, and California law separately bars firing an employee over garnishment for a single judgment.
How long does bankruptcy stay on my credit report?
A Chapter 7 can remain for up to 10 years from the filing date, and the credit bureaus typically remove a Chapter 13 after 7 years. The effect on your score fades well before those dates, especially with a secured card, on-time payments, and low balances.
What if the debt collector’s lawsuit is over a debt that is more than four years old?
The statute of limitations on a written contract or book account is four years, but it is a defense you must raise in a written answer. If you skip the answer, a court can still enter judgment. Do not make a payment before talking to a lawyer, because payments do not revive a time-barred debt but signed acknowledgments can create confusion about it.
How long does a judgment against me last?
A California money judgment is enforceable for 10 years from entry and can be renewed. For medical expense judgments and personal debt judgments under certain principal amounts, renewal is limited to one time for five years. Bankruptcy can address judgments that have already been entered, and our attorneys can review whether a particular judgment can be eliminated or its liens avoided.
Can a debt collector break the law and cost me nothing to challenge?
California’s Rosenthal Act covers original creditors as well as third-party collectors. A consumer can recover actual damages, an additional $100 to $1,000 if the collector acted willfully and knowingly, and reasonable attorney fees if they prevail. The suit must be brought within one year, and there are no class actions under the Act. Harassment by a collector is worth raising at your consultation.
Can I use a paralegal or notary to file instead of hiring a lawyer?
A bankruptcy petition preparer can type information into forms but cannot give legal advice, choose your exemptions, or represent you if a creditor or the trustee raises an issue. Errors can cost you property or your discharge, which is why representation by a bankruptcy attorney matters.
Do I have to come into an office to file?
No. The firm handles cases fully by phone, email, video, and online chat, and 100% virtual consultations are available, so you can complete the process without leaving home.
Serving Pasadena and Surrounding Bankruptcy Clients Across Los Angeles County
Wadhwani & Shanfeld represents clients in Pasadena and throughout Los Angeles County, including Los Angeles, Hollywood, Santa Monica, Glendale-area neighbors in the San Fernando and San Gabriel Valleys, and the Westside. In the eastern San Gabriel Valley, the firm works with people in Pomona, Claremont, Glendora, West Covina, Montclair, and Chino, along with the broader Inland Empire communities of Ontario, Rancho Cucamonga, Upland, Fontana, San Bernardino, and Riverside.
Across the San Fernando Valley, clients come from Sherman Oaks, Van Nuys, Encino, Woodland Hills, Reseda, Northridge, Granada Hills, North Hollywood, North Hills, Mission Hills, San Fernando, and Sylmar, and from Santa Clarita, Lancaster, Palmdale, Acton, and the Antelope Valley. In the south and southeast, the firm serves Long Beach, Lakewood, Torrance, Compton, Inglewood, Gardena, Norwalk, Bellflower, Paramount, Cerritos, Cypress, Signal Hill, and Huntington Park. In Orange County, it represents residents of Anaheim, Santa Ana, Garden Grove, Buena Park, Fullerton, Huntington Beach, Westminster, Costa Mesa, Newport Beach, Tustin, La Habra, Placentia, Mission Viejo, and Laguna Niguel, and it also serves the Coachella Valley.
Talk With a Pasadena Bankruptcy Attorney Today
You do not need to have settled on a chapter, or on bankruptcy at all, before you call. A Pasadena bankruptcy attorney at Wadhwani & Shanfeld will review your income, property, and debts, explain every option inside and outside of court, and tell you honestly which path gives you the best fresh start. Call for a free consultation, speak directly with an attorney, and get a plan before the next deadline arrives.
