bankruptcy exemptions

A term you will often hear, whether you file Chapter 7 or Chapter 13 bankruptcy, is “ bankruptcy exemption.”  This is special protection that the Bankruptcy Code provides for a certain amount of value in your personal property.  See 11 U.S.C. § 522.  There are federal and state bankruptcy exemptions, and the state exemptions are different from state to state.  The difference in federal and state exemptions is the dollar amount of certain pieces of property that are protected.  A bankruptcy lawyer can structure your case to maximize your bankruptcy exemptions and help prevent liquidation of assets.

Florida or Federal Bankruptcy Exemptions

In order to determine which bankruptcy exemptions apply to your case, first look at whether your state is an “opt-out” state.  “Opt-out” means that you are required to use your state’s exemption amounts—not federal.  Florida is an “opt-out” state.  So, if you file your case in Florida, you must use Florida’s exemptions for all of your property; you do not get to pick and choose whether you use federal exemptions on some pieces of property, and Florida exemptions on other pieces.  However, if your state is not an “opt-out” state, you are free to choose either federal or state exemptions to protect your property.

Bankruptcy exemptions are vital to a bankruptcy case and can be difficult to master, if you need assistance contact a bankruptcy lawyer in Tampa. A bankruptcy attorney should be able to structure your Chapter 7 or Chapter 13 in a way that maximizes the protection you can receive from exemptions

Homestead Exemption

Typically, the most important exemption—especially in Florida—is the “homestead exemption.”  The Florida homestead exemption is one of the best in the nation in that it protects all of the equity in your home (meaning your house is worth more than you owe).  See Fla. Const. art. X, § 4. To enjoy the homestead exemption, you must be domiciled in Florida for 730 days prior to filing your bankruptcy petition.  “Domicile” is your place of residence with the intent to remain there permanently.

Wildcard Exemption

If you are not claiming the homestead exemption, you can receive the “wildcard exemption.”  This provides you with $4,000 to apply to any piece of property you would like, whether it is your car, a diamond ring, or your favorite china set.  Fla. Stat. § 222.25.  It exists to allow you to pick and choose what is protected in your bankruptcy because it is important to you. A bankruptcy attorney experienced in wildcard exemptions can assist with this.  Although Florida has one of the most generous homestead exemptions, it does have lower exemption amounts than some federal exemptions.  Just remember, you cannot choose to use some federal exemptions in Florida; you must use Florida’s exemptions in your bankruptcy case.

Other Bankruptcy Exemptions

There are other exemptions you can apply to a wide range of personal property as well.  Some examples are motor vehicles, boats, household furnishings, household goods, clothing, appliances, books, crops, musical instruments, jewelry, tools of trade, health aids, life insurance policies, wages, and retirement accounts.  The exemptions are categorical and cannot spill over to other items.  For example, each person who files bankruptcy in Florida is given $1,000 to protect his or her car.  If you and your spouse are filing jointly, you will be given $2,000 towards your cars.  So, if you have a car worth only $750, you cannot put the leftover $250 towards protecting more of your jewelry or whatever else you are trying to protect—what you cannot use of the vehicle exemption, you lose. You should consider hiring a Tampa bankruptcy attorney to help structure your case to most effectively use Florida’s exemptions.

Bankruptcy Law Firm:

If you are struggling with debt Florida law advisers may be able to help get a fresh start. Regardless if you need help with Chapter 13 or Chapter 7 we provide legal advice you can trust. We are dedicated to providing effective representation, individualized attention, and affordable fees to our bankruptcy clients. All of our initial consultations are free and convenient payment plans are always available. Call us now at 800 990 7763 to speak with a Tampa bankruptcy lawyer.

Stop creditor harassment

When you file either Chapter 7 or 13, an “automatic stay” is put into place under bankruptcy law. The automatic stay requires all collection activity against the debtor to stop immediately. The automatic stay is the quickest way stop creditor’s phone calls and stop creditor harassment. Creditors will not be able to contact you, garnish your wages, or repossess your property during the automatic stay. The stay is applicable to all creditors, none of them will be able to take any collection action. See bankruptcy law 11 U.S.C. § 362(a).

How Long Does the Automatic Stay Stop Creditor Harrassment?

In most cases, the automatic stay will remain in effect and stop creditor harassment until your bankruptcy case is discharged. The automatic stay is available under both Chapter 7 and Chapter 13 bankruptcy. If you are unsure about which Chapter is right for you speak with a bankruptcy attorney in your area. Florida Law Advisers, P.A. offers a free initial consultation for bankruptcy clients, to speak with a bankruptcy lawyer in Tampa click here.

Typically, the stay is automatically lifted for all creditors once your case is closed. See bankruptcy case Failla v. Citibank.  For example, if you did choose to surrender your home, the secured creditor can start the foreclosure process on your home as soon as the stay is lifted at the end of your case without first having to seek approval from the bankruptcy court. However, the creditor will be unable to continue with the foreclosure process until the stay has been lifted.

Stop Creditor Harassment With The Automatic Stay

If a secured creditor wants to move forward with collection efforts after the stay has been enacted, the creditor must first seek approval to do so from the bankruptcy court. This process will require notice to you (the debtor) and a hearing. See U.S. Supreme Court Case: Citizens Bank of Maryland v. Strumpf. Thus, the automatic stay will stop creditor harassment until it is lifted by a judge.

If the judge grants the secured creditor the ability to move forward with their collection after the hearing, the automatic stay is considered to be “lifted” and the secured creditor can come after the piece of property that it wishes to repossess. An example of this process would be in a Chapter 7 where you choose to surrender your home. If the secured creditor wants to take your home from you, the creditor must go through the process of seeking approval from the court in order to do so. For more information about a creditor’s right to lift the automatic stay contact a bankruptcy lawyer in your area.

Automatic Stay Stops Foreclosure

If there is an active foreclosure, the automatic stay will freeze the foreclosure as soon as the bankruptcy is filed. You want to make sure that once you file your bankruptcy petition to stop the foreclosure action that you also file a “Suggestion of Bankruptcy” form in the state court foreclosure lawsuit right away. This must be done before the foreclosure sale date  in order to stop the sale of your home. This assures that the state court judge is on notice of your bankruptcy so the foreclosure can be stopped on time. The Tampa bankruptcy law firm you hired should file the suggestion of bankruptcy in your foreclosure case on your behalf.

Exceptions to Automatic Stay

The automatic stay does not apply to all types of debts, or collection activities. Bankruptcy law provides for many exceptions from the automatic stay. For a more complete list of exceptions see bankruptcy law 11 USC §362 or contact a bankruptcy attorney. If your creditor is exempt, bankruptcy may not stop creditor harassment.

Tampa Bankruptcy Law Firm

At Florida Law Advisers, P.A., the Tampa bankruptcy attorneys have years of experience helping people just like you to solve their financial problems. We understand that these are very difficult times and we are here to help. We have many options available that can help you successfully manage your debt and regain your financial health. The right course of action will depend on the unique circumstances of your case. To see which options may be available to you, contact us to today to schedule a free, confidential consultation with a Tampa bankruptcy lawyer at our firm.

bankruptcy affect Social Security payments

Clients commonly ask us, will bankruptcy affect Social Security payments? Generally, your Social Security benefits are protected under Chapter 7 and Chapter 13 bankruptcy. Therefore, the funds belong to you and the trustee cannot take them. See bankruptcy law 11 U.S.C. 522. The monthly benefits that you receive in Social Security are exempt from being seized or garnished. However, each case is different and you should speak with a bankruptcy lawyer if you have questions. This article about how bankruptcy affect Social Security payments is general in nature, and not legal advice for any particular case or circumstance.

Will Bankruptcy Affect Social Security Payments if Kept in a Separate Bank Account

It may be helpful, prior to filing bankruptcy to your keep your Social Security payments in a separate bank account from your regular funds. This is because a bankruptcy trustee will look at six months of bank statements up to the date of when you file your bankruptcy petition. If your Social Security payments have been mixed in with your personal money it can create issues. For instance, the trustee may argue that you cannot differentiate and prove which funds are Social Security money and therefore cannot receive the Social Security protection. This is one of the many reasons why it is important to have a bankruptcy attorney assist you. A successful bankruptcy plan should begin before your Chapter 7 or Chapter 13 bankruptcy case is filed.

If your Social Security benefits have already been mixed (or “comingled”) with your personal funds within one bank account, you may be able to still protect those Social Security funds by way of the “wildcard exemption.” For more information on exemptions click here. The wildcard exemption is an additional $4,000 that is allotted to you to protect your personal property, including income. See Florida Statute 222.25

Chapter 7 Means Test

In Chapter 7, you do not list your Social Security payments on your Means Test. The means test is necessary to qualify for Chapter 7. Thus, you have a greater chance of passing the test and qualifying for Chapter 7 because your income will be lower. The Bankruptcy Code provides that Social Security is not included in “current monthly income.”  See Bankruptcy law 11 USC 101. The means test can be very complicated. If you need assistance hire a bankruptcy lawyer to help with filing for Chapter 7 bankruptcy. The means test has a lot of nuances, and requires a thorough understanding of bankruptcy law.

Tampa Bankruptcy Law Firm

If you are having a difficult time meeting your financial obligations Florida Law Advisers, P.A. may be able to help. Our Tampa bankruptcy attorneys have years of experience helping clients obtain a fresh start. We combine our experience and skills in the courtroom with a thorough knowledge of the law to help achieve the results our clients need and deserve. When you hire Florida Law Advisers, P.A. you don’t just get legal advice, you get experienced bankruptcy lawyers by your side every step of the way. To learn more about how Florida exemption law can affect your bankruptcy call us today at 800 990 7763.

HOA Foreclosure in Florida

Homeowners are often surprised to learn that their homeowners’ association may be able to foreclose on their home. HOA’s may be able to seek foreclosure in Florida for missed payments, failure to maintain property. Additionally, there may be other grounds set forth in the Association’s declarations and by-laws.  In many instances, an HOA foreclosure in Florida will even involve homes with no mortgage or other liens. Fortunately, there are ways to fight back against an HOA foreclosure in Florida. If you are being threatened with an HOA foreclosure contact a foreclosure defense lawyer for assistance.

HOA Foreclosure in Florida

Florida is a judicial foreclosure state, that means a party seeking to foreclose a home must go to court and receive approval from a judge before a home is sold at a foreclosure action. This includes not just banks, homeowners’ associations must also go through the judicial process. Unfortunately, many HOA’s are very aggressive and will seek foreclosure if a homeowner fails to pay the HOA’s fees. In fact, many HOA cases stem from balances due of less than $100. Homeowners facing an HOA foreclosure in Florida should contact a Tampa bankruptcy attorney for assistance. Bankruptcy can potentially provide additional options to stop the foreclosure and help keep your home.

The Automatic Stay to Stop HOA Foreclosure in Florida

When a debtor (borrower) files for bankruptcy an automatic stay is put in place as soon as the Chapter 7 or Chapter 13 bankruptcy is filed. See bankruptcy law 11 U.S. Code § 362.   The automatic stay requires all collection activity against the debtor to stop immediately, including a foreclosure sale that has already been scheduled. For more information on the automatic stay click here.

Chapter 13 Payment Plan

A Chapter 13 bankruptcy filing could allow you to avoid an HOA foreclosure in Florida all together by working out a repayment plan over a span of three to five (3-5) years for the arrearage, otherwise known as back-due payments.  Essentially, the homeowner will have a 60-month loan to repay the back-due HOA fees. Most of the time, the interest rate applied to these types of payment plans is around 6%.  For more information about a specific case or payment plan contact a lawyer in your area to schedule a consultation.

Lien Stripping

Under Chapter 13 bankruptcy law, junior liens (including mortgages or a homeowner’s association liens) can be stripped, or removed from homestead property. Thus, if the lien is stripped down to the market value, the remaining balance of the debt will be treated as an unsecured debt in bankruptcy. Usually, Unsecured creditors receive nothing or only a small amount of the balance before being discharged.  Further, after the discharge is granted in your bankruptcy case the lien holder (HOA) will be required to remove the lien from the property. For more information on why the discharge is so important, click here.

Bankruptcy and Foreclosure Defense Law Firm

If you are thinking about filing for bankruptcy or are being threatened with an HOA foreclosure in Florida contact Florida Law Advisers, P.A. Our bankruptcy attorneys in Tampa are experienced in both bankruptcy and foreclosure defense. Every foreclosure and bankruptcy case is different, and our vast experience allows us to cater our services to each client’s individual needs. All of our initial consultations are free and convenient payment plans are always available. Regardless, if you need help HOA foreclosure in Florida, Chapter 7, or Chapter 13 we can help. Call us now at 800 990 7763 to speak with a lawyer, we are available to answer your calls 24/7.

How to Keep Property in Bankruptcy

Many people who choose to file Chapter 7 do so because they can no longer afford their debts. In Chapter 7, there are generally three options on how to keep property in bankruptcy. If the property has a loan/ lien securing the debt, a statement of intention as to those secured debts must be filed within 30 days of filing your bankruptcy. See bankruptcy law  11 U.S.C. § 521. It is highly recommended to consult with a bankruptcy attorney prior to completing you statement of intentions. Without competent advice you may accidentally limit the amount of relief bankruptcy can provide. For information on how to treat debt in a specific case contact a bankruptcy law firm in your area.

Reaffirm Debt in Bankruptcy

Generally, the first option for borrowers is to reaffirm the debt. Reaffirmation can be a successful tool used when trying to figure out how to keep property in bankruptcy. A reaffirmation essentially creates a new loan agreement between you and the lender. In reaffirmations, you pay the loan amount in full, at an agreed interest rate, within a certain amount of time.  If a reaffirmation agreement is signed by all parties and approved by the bankruptcy judge it will be binding.  Once a reaffirmation agreement is finalized, this debt will no longer be dischargeable because you are agreeing to pay the full amount.

If for some reason you stop making payments on a car loan after entering into a reaffirmation agreement, the lender not only can repossess your vehicle, but you also become personally liable for that remaining debt and the lender can obtain a judgment against you. So, make sure you truly want to keep that vehicle (or home) before entering into a reaffirmation agreement. You should consult with your bankruptcy attorney for advise on your specific situation.

How to Keep Property in Bankruptcy with Redemption

The second option borrowers can consider when evaluating how to keep property in bankruptcy is to redeem the property. This means that you, or someone on your behalf, who can pay the remainder of the loan in full, in cash, at that moment.  If you have someone that can do that and you choose to redeem the property, then you will own it free and clear of any liens.  However, careful consideration should be taken before redeeming property. Consult with a bankruptcy lawyer in Tampa to see if this option is right for you.

Surrender the Property in Bankruptcy

The third option is to surrender your property. If you surrender your home , you are walking away from it, handing it over to the trustee assigned to your case. Further, you are not allowed to defend a foreclosure action against your home after you receive discharge. See  bankruptcy case Failla v. Citibank . When you choose to surrender real or personal property, you will no longer be personally liable for the debt connected to that piece of property. The surrender option exists to give you a “fresh start” and a creditor cannot later come after you for the amount discharged from your decision to surrender.

Bankruptcy Exemptions

Additionally, property may be kept if it qualifies for an exemption. Exempt property is property that you do not have to forfeit when filing for bankruptcy and are instead entitled to keep. For more information on bankruptcy exemptions click here.

Bankruptcy Law Firm

If you are struggling with debt Florida law advisers may be able to help get a fresh start without having to lose your property.  We are dedicated to providing effective representation, individualized attention, and affordable fees to our bankruptcy clients. All of our initial consultations are free and convenient payment plans are always available. Call us now at 800 990 7763 to speak with a Tampa bankruptcy lawyer.