Florida Bankruptcy: Chapter 7, 11 or 13

If you’re considering filing for bankruptcy in Florida, you may be confused regarding which type is right for you? There are three different kinds of bankruptcy, Chapter 7, Chapter 13, and Chapter 11. Each is designed to offer relief from creditors to those who are filing, and each has specific rules and regulations that are used to define who may utilize which.

Chapter 7

With Chapter 7 bankruptcy, those who file are able to discharge all unsecured debts, such as those related to credit cards, medical bills, and personal loans, while protecting property from creditors that the court considers to be exempt. Property that is exempt includes their home, primary motor vehicle, and personal possessions.

Taxes, mortgages, car payments, and other such debts are not forgiven under Chapter 7, and debtors may still lose their car or home if they do not make timely payments. In order to file for personal bankruptcy under Chapter 7, the debtor must qualify by undergoing a means test or meeting certain financial criteria. A qualified bankruptcy attorney can explain the process to you and help you determine if you qualify for Chapter 7.

Chapter 13

Chapter 13 is the other form of personal bankruptcy. If you don’t meet the means test for Chapter 7, then chances are if you have crushing debt that you can qualify under Chapter 13. Chapter 13 allows debtors to pay creditors on a schedule created by the debtor and approved by the court.

Under Chapter 13, the person filing for bankruptcy will usually pay a certain percentage of their debt off and will have the rest forgiven. The court normally gives the debtor from three to five years to take care of their bills. After that, all debts, whether they are paid or not, are forgiven.

As it is with Chapter 7, the person who files for Chapter 11 must pay taxes, mortgages, car loans, and other such debts, and keep current on all. Once the payment schedule is approved, the debtor sets up payments to the court and the court pays the creditors in a timely manner.

Chapter 11

The third bankruptcy option, Chapter 11, tends to be used less often than the other two. That’s because Chapter 11 is more complex than Chapter 7 and 13 and, often, more expensive. It also involves more risk. Chapter 11 tends to be utilized by corporations, allowing them to reorganize and negotiate with creditors concerning their debt. Sometimes individual business owners will use it if they owe too much debt to file for Chapter 13, but still feel the need to file.

What Are the Basic Differences Between Chapter 7 and Chapter 13 Bankruptcy?

Bankruptcy can be an overwhelming topic to understand, but many who investigate the available options will discover that the two choices available are Chapter 7 and Chapter 13. These two options are handled very differently and it is important for those considering bankruptcy to know the differences when choosing how to proceed. Both are nuanced and complex, but there are some major differences in how these options are pursued and completed that can help an individual know which may work best for his or her needs.

Bankruptcy is known as an option for those facing overwhelming or insurmountable debt. If the debtor elects to pursue Chapter 7 bankruptcy, all of the individual’s non-exempt property can be sold by a trustee in order for the proceeds to be put toward the debt.

However, Ohio and Kentucky both allow for many property exemptions. Most Chapter 7 scenarios are actually considered “no asset” cases, meaning that the debtor will not be forced to part with any property and the creditors will receive no proceeds. It can be difficult to know what assets are exempt during this process, but a bankruptcy attorney can be highly beneficial in analyzing your situation to help you understand what property would be considered exempt when filing under Chapter 7.

Some of the common exemptions during this process include:
• Homestead – real or personal property
• Personal Property – burial plot, motor vehicle, bank accounts, tax refunds, household goods, furnishings, musical instruments
• Wages – minimum of 75% of disposable weekly earnings
• Pensions – tax exempt retirement accounts, public employee pension
• Tools of trade – tools, books, implements
• Alimony – alimony and child support
• Insurance – disability, life, group life
• Misc. – business partnership property
• Wildcard – $1,150 of any property

This type of filing is beneficial because it negates the debts that a person owes. While some property may be lost, often times a person can be relieved of most of their debt. In addition, this method is typically a more efficient and quick way to complete a motion for bankruptcy. It does still carry long-term consequences, though, so this option should be considered carefully.

Chapter 13 bankruptcy is often a more complicated process. This option typically is more appropriate for those who would like to protect their assets while repaying their debts in a more forgiving environment. The courts will protect a debtor who files under this plan in order for them to pay back mortgage debt or other payments through a longer period. This situation can provide protection for cosigners or other third parties on items such as automobiles.

Another important difference in the two options is that certain types of debt cannot be discharged under Chapter 7 but are eligible under Chapter 13. One of the major debts involved is any debt regarding property settlements during a divorce. These debts cannot be discharged under Chapter 7, so it is important to consider this if debt through a divorce is part of the cause of filing for bankruptcy.

The Benefits of Hiring Bankruptcy Attorneys

For families and individuals who are really struggling with debt in relation to their earnings, bankruptcy can denote to be a fresh start to your life and a stable financial future. In other situations, filing a bankruptcy is the most financially dependable action a person can take. Depending on the chapter of bankruptcy that you want to follow, you can either pay off the debts or finish those debts. Also, filing for bankruptcy helps stop those violent calls from creditors who will call you every time demanding for their payment and to stop foreclosure of your properties. That is precisely why lawyers open doors for your help. Lawyers will do the best to make sure that you are not in any overwhelmed with those debts and they will work with you in every single step to build a brighter future for you.

By filing the Chapter 7 bankruptcy form, you are offered a fresh schedule to start from. Chapter 7 eliminates all the debts by selling all the non-secured assets to your trustee. After the assets are sold, the cash that is collected will be paid out to the different creditors whom you owe the money. This form of bankruptcy is really beneficial because it offers you a new start to a better future.

Chapter 13 is typically preferable to people who do not easily qualify to get a straight bankruptcy. People with assets and getting an average income are as well advised to fill the chapter 13 bankruptcy. The chapter allows the people to renegotiate with the debtors on the terms of the payment. The debtor is able to easily budget himself by just paying off the loan, but this is done at a lower payment rate and also smaller installments that one is able to handle comfortably. Chapter 13 also allows the defaulter to keep the assets while he or she is paying back the debt.

Bankruptcy can in other cases be a very serious trouble and therefore you need not to stand alone while struggling with it. Do not be uncertain to seek legal advice from the competent lawyers when you are dealing with bankruptcy problems. Lawyers welcome all potential clients and are very ready to assist you in any single possible way out. The laws can as well give a voice to debtors to have a say to their present financial problem and help them to overcome it. If you are overwhelmed with your debt, lawyers can help you to determine if bankruptcy can benefit your case because there are many bankruptcy options available to suit all peoples’ needs.

Choosing a Bankruptcy Lawyer Without the Headache

Bankruptcy lawyers are doing a whole lot of business nowadays. Whereas this should be an advantage for anyone looking for an attorney, the number of lawyers actually makes it harder to locate the best in the lot.

There is, therefore, a need for clients to take their search seriously for better legal representation.

To help you find the best lawyer and to enable you file for bankruptcy without any disappointments, here are some factors to consider:

Your friends and relatives can come in handy when you are beginning your search. The idea is to get as many recommendations as possible so that you can have a list of candidates to choose from.

Your search for advice should be limited to those people who have hired the services of bankruptcy attorneys before. You may opt for the directory addresses you find but they are not as advantageous as having word-of-mouth recommendations.

Lawyers usually work with other lawyers, among them bankruptcy attorneys. If you know a lawyer you have worked with before, you can ask them for their opinion and advice. They might even be able to recommend the services of good attorneys they know or work with.

If you do not know any lawyers and you cannot get word-of-mouth recommendations, you can also settle for the list of the bar association in your state. With the internet here to serve us, you’re also able to hook up with a good attorney online. All you have to do is look for reviews of local attorneys.

You can narrow down your search by looking for specific bankruptcy attorneys in your state or near your area of residence. You may also opt for the actual search for an attorney, which involves visiting different law firms or offices of lawyers. This step, however, takes time.

Do not settle for a lawyer without interviewing them first. This is a necessary step as it will enable you know a bit more about the lawyer you are looking to hire for your case. Initial consultations are very helpful. Most people decide whether to hire the lawyer they interview or moving on to the next on their list at this stage. Your lawyer should be well-rounded.

She or he should know their way in and out of court. They should also have experience working with debtors, creditors and court officials. Above all, their communication skills should be unmatched, because this will be crucial in negotiating during the process.

Payment is paramount in any legal representation expect for pro-bono (free) work. Make sure that you and your lawyer work out a good and reasonable plan on how you will pay for their services. It is also wise to make a comparison of prices before you settle for any specific attorney.

This way, you can take advantage of any offers and price reductions through negotiations. Availing all materials relevant for your case is also recommended. These may include documents such as your bank statement, etcetera. The bankruptcy lawyer will then know how else you can contribute to the process.

When You Should Look For A Good Bankruptcy Attorney

Life has its own twists. Unfortunately you are not really ready for it. There are times when you are in debt and you have to pay huge bills. Debts can keep on increasing for many reasons. The reasons are sometimes logical. It can end up becoming a huge amount of money which a person fails to pay. Now let’s discuss on the most important facts which can put you in a financial crisis.

Thanks To The Medical Bills

One of the very first things which every person fails to pay is the medical bills. Hospital bills keep on increasing depending on the kind of accident or illness you have. The worst thing is you don’t have any idea how much you have to pay. Moreover, you cannot control it. They are very expensive and a costly affair for most people.

The cost of surgeries, x-rays, emergency room visits are huge. Modern hospitals have the best medical equipment which is quite expensive. What they do is pass down the costs to the patient. This is when you need a bankruptcy attorney who can help you get out of the mess.

Credit Card Debt

Credit cards are one of the major reasons of the increasing debts. Unfortunately, people decide to get a credit card so that they can cope up with the small debts. But the purpose is not served in the right way. They prefer using the credit card during an emergency or when they have zero cash.

Credit cards are a very convenient option and you can use it when the need arises or you don’t have instant cash. The only difference is that you have to pay a price. Interest rates can also maximize your credit card debt. It adds up to the amount quickly and people find themselves in a financial crisis. Hire a bankruptcy attorney who can offer the best help.

The Right Solution To All Your Problems

For those who are encountering debt issues this is the very right time to look for a bankruptcy attorney. They have experience in all the different kind of bankruptcy laws. They have the right skills, knowledge and experience to help you resolve the debt issues.

It gives you peace of mind when you are in a financial crisis. They can reconcile your debts through a court-approved payment arrangement which can help you deal with the things easily. Keep all these great tips in mind when you are bankrupt.