Orlando Bankruptcy Attorney

Filing for personal or business bankruptcy can be more beneficial than it might seem at first glance. It can provide you with an opportunity to get your finances in order and start fresh. After all, paying your debts while covering your expenses can be challenging if they far exceed your monthly income. Determining how to afford everything without falling farther behind on payments can be overwhelming. Call us for a free consultation with an experienced Orlando bankruptcy attorney to learn more.

Bankruptcy in Florida

Bankruptcy in Florida offers individuals and businesses a legal pathway to manage or eliminate debt when faced with financial distress. Governed by federal law, the bankruptcy process in Florida is designed to provide relief and a fresh start for debtors while ensuring fairness to creditors. This guide outlines the types of bankruptcy available, the process, and key considerations for those considering bankruptcy in Florida.

Types of Bankruptcy

There are several types of bankruptcy under the U.S. Bankruptcy Code, but the most common for individuals and businesses in Florida are Chapter 7, Chapter 13, and Chapter 11 bankruptcies.

Chapter 7 Bankruptcy: Also known as liquidation bankruptcy, Chapter 7 is available to individuals and businesses. It involves the sale of non-exempt assets by a trustee to repay creditors. To qualify, debtors must pass a means test, which compares their income to the median income for a household of similar size in Florida.
Chapter 13 Bankruptcy: Known as reorganization bankruptcy, Chapter 13 is for individuals with a regular income who can repay their debts over a three to five-year period according to a court-approved repayment plan. This type allows debtors to keep their property while catching up on missed payments.
Chapter 11 Bankruptcy: Typically used by businesses, Chapter 11 allows for the reorganization of debts while the business continues to operate. This type of bankruptcy can also be used by individuals with substantial debts and assets, providing a flexible plan for restructuring.

The Bankruptcy Process

The bankruptcy process in Florida involves several steps, starting with credit counseling and culminating in the discharge of debts.

Credit Counseling: Before filing for bankruptcy, individuals must complete a credit counseling course from an approved agency within 180 days. This helps ensure that bankruptcy is the appropriate option.
Filing the Petition: The debtor files a bankruptcy petition with the U.S. Bankruptcy Court, including detailed financial information such as assets, liabilities, income, and expenses. The automatic stay takes effect immediately, halting most collection actions.
Trustee Appointment: A bankruptcy trustee is appointed to oversee the case. In Chapter 7, the trustee manages the liquidation of assets. In Chapter 13, the trustee oversees the repayment plan.
341 Meeting: Also known as the meeting of creditors, the 341 meeting allows creditors to ask the debtor questions about their financial situation and the bankruptcy filing. The trustee also verifies the information provided by the debtor.
Repayment Plan Confirmation (Chapter 13): For Chapter 13 cases, the court must approve the repayment plan. The debtor makes regular payments to the trustee, who then distributes the funds to creditors.
Discharge of Debts: Upon successful completion of the bankruptcy process, eligible debts are discharged, meaning the debtor is no longer legally required to pay them. In Chapter 7, this typically occurs a few months after the 341 meeting. In Chapter 13, discharge occurs after all plan payments are made.

Exemptions & Protections

Florida has specific bankruptcy exemptions that allow debtors to protect certain property from being liquidated. Key exemptions include:

Homestead Exemption: Florida has an unlimited homestead exemption, protecting a primary residence regardless of its value, as long as it is situated on half an acre or less in a municipality or 160 acres or less outside a municipality.
Personal Property: Up to $1,000 in personal property or $4,000 if the homestead exemption is not used.
Wages: Wages of the head of the household up to $750 per week are exempt.
Retirement Accounts: Most tax-exempt retirement accounts, including 401(k)s and IRAs, are fully protected.

Considerations & Legal Representation

Filing for bankruptcy has significant financial and legal implications, so it’s essential to consider all options and seek professional advice. Bankruptcy can affect credit scores, ability to obtain loans, and other financial opportunities.

Bankruptcy in Florida serves as a vital resource for individuals and businesses facing insurmountable debt. By understanding the types of bankruptcy, the process, and available exemptions, debtors can make informed decisions about their financial futures. With proper legal counsel, bankruptcy can offer a fresh start and the opportunity to rebuild financially.

Given the complexity of bankruptcy laws and procedures, it’s advisable to consult with our qualified Orlando bankruptcy attorneys. Florida Law Advisers, P.A. can provide guidance on eligibility, protect rights throughout the process, and ensure compliance with all legal requirements.

How Do I Declare Bankruptcy?

You must complete multiple steps to declare bankruptcy in Florida.

Gather Documents

Before initiating the bankruptcy process, gathering relevant documentation and information is essential. You should be prepared with the following information:

A list of your creditors, the nature of the debt, the amount owed to each, and their mailing addresses
Income information, including your salary or pay rate, which can be found on your tax returns or paycheck stubs
A list of all the property you own, including real estate and valuable personal items
A detailed list of your reasonable and necessary monthly living expenses, such as your mortgage, utility costs, groceries, car payments, medications, and so on

You might find that referring to the following documents while completing the bankruptcy forms is helpful:

Creditor statements and bills
Bank statements from the last six to 12 months
Collection agency and third-party debt collector letters
Your credit report

Complete a Credit Counseling Course

You must take a credit counseling course before filing for bankruptcy in Florida. The following requirements apply to a credit counseling course:

You must pay a fee unless you can get it waived by submitting a specific request
You must complete the course within 180 days before filing for bankruptcy
The course must be with an approved credit counseling provider
The certificate of completion must be filed with the necessary bankruptcy forms

Pass the Means Test

You must take the Chapter 7 means test to determine whether you are eligible for Chapter 7 bankruptcy. Generally, your average monthly household income must be less than the median income for similar households as determined by the U.S. Census to qualify for Chapter 7 bankruptcy. However, there may be exceptions, so it’s essential to speak to an Orlando bankruptcy lawyer who can ensure that you calculate your income correctly. Your eligibility for Chapter 7 is less likely the higher your disposable income is. If you don’t qualify for Chapter 7, consider filing for Chapter 13 instead.

Complete and File the Bankruptcy Forms

If you pass the means test, you can fill out the necessary forms and file them with the court. The court will assign a Chapter 7 trustee to your case. The trustee will verify your provided information and manage the rest of the bankruptcy process. You will likely need to provide your trustee with various financial documents, such as your tax returns and bank statements.

Take Another Course

You must take a debtor education course after filing for Chapter 7 bankruptcy. There, you will learn skills to manage your finances, such as budgeting. You must complete the course and submit your certificate of completion to the court before your debt is discharged.

Pros and Cons of Filing for Bankruptcy

You should carefully consider whether filing for bankruptcy is right for you. Although there are multiple benefits, some drawbacks might deter you from proceeding.

The potential advantages of filing for bankruptcy include the following:

You might keep some assets if you file for Chapter 13.
Creditors can’t contact you or pursue collections actions.
Your credit score may increase after discharging your debt.
A trustee handles your case for you.
You could pay less than what you owe.
Bankruptcy alleviates your responsibility over most unsecured consumer debt.

The possible disadvantages of filing for bankruptcy include the following:

Discharging all debt is not possible, such as taxes, court orders, and alimony.
Your trustee might have to sell your assets to repay the creditors.
People you know might discover your case because the information is public.
Bankruptcy can remain on your credit report for as long as 10 years.
You can face legal action if you provide false or inconsistent information when you file.
Your credit score could plummet depending on what it is before filing.
Bankruptcy requires upfront payment of service fees and other expenses.

Can I Keep My Car If I File for Bankruptcy in Florida?

It depends on your specific circumstances and the type of bankruptcy you file. In Chapter 7 bankruptcy, you may be able to use Florida’s vehicle exemption to protect up to $1,000 of equity in your car (or $4,000 if you don’t use the homestead exemption). In Chapter 13 bankruptcy, you can keep your car by including any overdue payments in your repayment plan. Your attorney can help determine how to protect your vehicle during the bankruptcy process.

What Debts Cannot Be Discharged in Bankruptcy?

While bankruptcy can alleviate many financial burdens, certain debts are generally not dischargeable, including:

Child support and alimony obligations.
Most tax debts.
Student loans, except in cases of undue hardship.
Debts incurred through fraud or willful misconduct.
Court-ordered fines and restitution.

Your bankruptcy attorney can review your debts and advise which ones may remain after the process is complete.

Reach Out to Skilled Orlando Bankruptcy Lawyers at Florida Law Advisers, P.A.

The experienced Orlando bankruptcy lawyers at Florida Law Advisers, P.A., can help you make the best financial decisions so you can move forward with your life. We can review your situation and advise you on rebuilding your financial standing. Call us for a free consultation with an experienced bankruptcy attorney in Orlando to learn more.