Home to Hollywood, a booming tech scene, and countless cultural attractions, Los Angeles remains one of the most desirable cities in the world. But with that popularity comes a steep cost of living—rents are high, utilities can be pricey, and everyday expenses seem to climb each year. For many Angelenos, the financial strain can reach a tipping point where bankruptcy becomes a viable route to recovery.
LA’s housing market frequently ranks among the nation’s most expensive, pushing renters and homeowners alike to the financial edge. With limited affordable options, even a short period of unemployment or an unexpected medical bill can set off a downward spiral of debt.
Under Chapter 7, many unsecured debts—like credit cards and personal loans—can be discharged, allowing individuals to reset financially. Alternatively, Chapter 13 offers a structured repayment plan over three to five years, which can help protect crucial assets such as a home or car. Learn more about Chapter 13 here.
California has two sets of exemptions—“704” and “703”—that can protect a portion of your home equity, personal property, or other assets from liquidation in Chapter 7. Choosing the right set often makes the difference between keeping or losing critical property. Consulting a knowledgeable bankruptcy attorney is crucial.
Consider a freelance graphic designer in Los Angeles who faced mounting rent, irregular income, and accrued medical bills. After careful assessment, filing Chapter 7 bankruptcy enabled her to discharge credit card debts and medical expenses while retaining her personal vehicle under state exemptions. She used the fresh financial start to refocus on her portfolio without constant creditor pressure.
Disclaimer: This content is for informational purposes only and does not constitute legal advice. Consult a licensed attorney for individualized guidance.