Bankruptcy is a constitutional solution for people, businesses, and political entities to resolve financial distress. Bankruptcy is simple, humane, and the attorney’s fees are very moderate for the results obtained. Typically, your financial problems warrant a bankruptcy liquidation or reorganization long before you meet an attorney. We focus on how to get out of the problem and how to stay out of financial distress. There are four types of bankruptcies available to people as of January 1, 2004. The average individual typically invokes Chapter 7 for credit card problems or Chapter 13 for tax non-exempt assets and mortgage problems. Chapter 11 is a corporate reorganization and Chapter 9 is for political entities.
For individuals in Florida, you keep your home in which you live, your wages and salaries, any cash surrender value of any insurance and retirement plans, any workers, unemployment or crime victims compensation and $1,000.00 per debtor of personal property with potentially another $1,000.00 of equity in one vehicle per debtor. If you do not have a homestead property or will not benefit from homestead, you get an additional personal property exemption of $4000.00 per debtor.
Your case progress should be simple. There is a code book and a rule book for bankruptcy so it is fairly straight forward. When you decide you cannot pay your debts in a reasonable period of time, you need to decide which attorney to retain for your bankruptcy. Inability to pay debt can be easily calculated and if your debt structure is more than you’re going to make in the next calendar year, it might be time to consider this option. Your initial consultation is free, and at that time, our office will provide you with a worksheet so you can answer the questions that you will be asked at any time in the future in the bankruptcy process. Our office will prepare the pleadings and your requirement is to appear at one hearing within 40 days of filing with the possibility of additional hearings down the road. The day you file, you get protection from the United States Bankruptcy Court for you and your property by an automatic stay issued by the court. Typically, within 3-5 days, you will receive an order from the court which lets you know what your obligations are, but in our office this is followed up by a letter in plain English reminding you of what the court has ordered as well as suggesting that we review everything prior to court. Approximately 30 days into your case, you will go to a 5-10 minute hearing. Approximately 4-6 months later you will receive a discharge in a Chapter 7 or attend a confirmation hearing in a Chapter 13.
As always, the truth is the most important thing. So long as you advise your attorney of your true state of affairs in your finances, we can best inform you on how to proceed. If you are going to wipe out a creditor, it might be appropriate to close out any bank accounts with that creditor. Bankruptcy wipes out all of your debts except for fines, support and alimony, taxes and student loans. However, some debts are based on fraud, false financial statements, embezzlement’s, D.U.I. claims, malicious injury or damages and credit abuse are not dis-chargeable.
Chapter 13 is probably my favorite type of bankruptcy. It is an adjustment of debt for individuals with a regular income and Chapter 13 is designed to restructure some of your debts and wipe out or minimize others. We would submit a plan of payments to pay debts either in full or in part using your future income. This is especially an effective weapon for foreclosures, tax problems or issues that could become a problem in Chapter 7.
A final note, bankruptcy is unlike state court in that the law and the rules are actually on your side for a change. So long as you have not gone out of your way to defraud your creditors, bankruptcy is always a reasonable solution for your problems. Please call our office at (407) 894-6834 for a free consultation today!