1) The document discusses options for dealing with being sued, including ignoring it (bad choice) or filing for bankruptcy. 2) If a creditor gets a court judgment against you, they can garnish your wages, seize money from your bank account, place liens on your home or car, and even force the sale of your property. 3) The document recommends consulting a bankruptcy attorney to discuss options like filing for Chapter 7 or 13 bankruptcy, which can eliminate debts and provide protections from creditors collecting.

1. I Have Been
SUED!!
What do I do now?

2. The Good, the Bad, & the Ugly of
Using Bankruptcy to Protect Your
Paycheck, Bank Accounts, Car,
Home & Other Assets From Being
Seized by Your Creditors

3. In most situations in life we have choices. Some will turn
out well. Some not so much. The first choice is “do I do
something or do I do nothing.”
If you have been sued, doing nothing
is always a bad choice. Even if you
owe the money there are things that
you can do to protect yourself.

4. Ignoring the lion does not make
it go away.
It just makes you an easy meal.

5. writ
The two basic types of law suits for money.
Small Claims Court The form will have a
trial date. (No attorneys) No written answer
required. Just show up for the trial
Superior Court In California you have 30
days to FILE a written answer. If you do not file an answer in
30 days they will get a “default judgment” against you. Case
over. You lost.

6. If you do not answer or lose at
at a court trial the creditors get a
Court Judgment against you.
It will have how much that the
creditor can take from you.

7. The Creditor Got a
Court Judgment Against Me!
What Can They Do With That
Court Judgment?

8. gg
The Judgment Creditor Can:
• Take (garnish) 1/4 of your paycheck. This is after
taxes but before any other amounts like health insurance
or retirements are deducted. If your income is less than ¾
or less of the minimum wage they cannot take anything.
They do not have to give you notice before taking
your money!

9. L
• Seize (levy) all the money in your bank account.
This is true even if it leaves you no money for
food, rent, utilities, car payments, gas,
payments to other creditors or anything else.
Just like garnishment of your
paycheck, they do not give you
notice before taking your money!

10. • Can demand that other people who owe you
money pay them instead of you. That could even be
your friends and relatives. If you are self-employed, that
means that they can go your customers and make the
customers pay them instead of you. Needless to say, that is
not very good for business. The Creditor can also seize
inventory, and tools of your trade if the tools are worth
more than the exempt amount.

11. • Take and sell your car to pay them what you owe.
Fortunately they cannot take and sell your car if there is
less than $2,900 equity because that is the amount that is
“Exempt” and protected under California Exemption Laws.

12. • Place a “Judgment Lien” on your home. This means
That you cannot sell your home without paying them.
There are “exemptions” that can be used to protect your
equity in a home that will be covered next. If you are
below the exempt amount this lien can be “avoided.”

13. • Have
the Sheriff sell your home to pay the creditor.
If the creditor tries
to sell your home
they have to sell it
for enough money
to pay off the
mortgages, cost of
sale, and the
amount of your
exemption. Anything
beyond that can
be used to pay their
judgment. The
really scary part is they do not have to sell it for full value.

14. What Can I Do To Stop
Creditors That Have Court
Judgments From Taking
Things From Me?

15. You have bankruptcy and non-bankruptcy options.
Non-Bankruptcy Options:
•Pay the debt in full.
•Make a deal with the creditor to pay in monthly payments.
•Negotiate a settlement amount and pay that (plus income
taxes on the amount “forgiven” by the creditor.)
Obviously you cannot make a deal if the creditor won’t
agree to it. If you have no money you cannot make a deal.

16. Bankruptcy Options:
•File Chapter 7 bankruptcy to wipe out
most debts. This is usually the best and
least costly way to end debt problems.
•File a Chapter 13 bankruptcy to
reorganize some debts and wipe out
other debts. Chapter 13 bankruptcy
will be covered in another program.

17. When a Chapter 7 bankruptcy is filed there is an immediate
“automatic stay” restraining order that stop Creditors from:
•calling you
•threatening you;
•harassing you or your relatives;
•contacting you or your employer;
•filing or continuing a law suit; or
•trying to collect a court judgment.

18. A Chapter 7 Bankruptcy will wipe out
almost all consumer debts like:
•Credit cards
•Payday loans
•Personal loans
•Prior landlords
•Old utility bills
•Debts from vehicle repossessions

19. •Medical bills
•Foreclosed junior mortgages
•Cell phone and cable bills
•Automobile accidents
(if not alcohol or drug related.)
•Some income taxes
•Some overpayment of unemployment or
disability benefits

20. I Have Secured Debts Like a Loan
On My Home, Car, Furniture,
Jewelry or Appliances.
What Happens to These In
Bankruptcy?

21. If you owe money on a car, you can
keep the car by “reaffirming” the debt.
Other debts secured by
things like jewelry,
furniture, appliances,
electronics and even your home can be kept
simply by continuing to make the payments.

22. There is a saying “knowledge is power.”
Isn’t it time for you to get your power back?

23. I’m Gary Fraley. I am a Sacramento Bankruptcy Attorney
with over 35 years experience helping people just like you.
I am a California State Bar Certified
Bankruptcy Law Specialist. I have a perfect
10.0 rating by the Avvo.com rating service.
Call me now at (916) 485-5444 and
schedule your free attorney consultation to
see if filing bankruptcy could help you.