BANKRUPTCY ATTORNEYS IN MIAMI AND WEST PALM BEACH
CHAPTER 7
A Chapter 7 bankruptcy allows you to get a fresh start financially, as your debts can be eliminated. You can retain possession of your primary home, car, and retirement plan. Chapter 7 bankruptcy can also immediately stop wage garnishment, foreclosures, and can eliminate deficiency mortgage balances.
CHAPTER 13
Chapter 13 bankruptcy allows you to eliminate a second mortgage, provided the current value of your home is less than the value of your first mortgage. It can also serve as a repayment plan, consolidating your debts and repaying them interest-free. During this period, creditors cannot collect from you. Chapter 13 bankruptcy stops the foreclosure process, allowing you to continue making payments on your home to the mortgage company. Bankruptcy can stop the sale of your home in foreclosure, garnishment of your wages, and lawsuits.
FREQUENTLY ASKED QUESTIONS
CHAPTER 7
Question: Will I lose all of my property if I file a Chapter 7 bankruptcy?
Answer: Although most of your debt is eliminated in a Chapter 7 bankruptcy, you won’t automatically lose all of your property. If you can continue making your house and car payments and reaffirm your debts, you can keep your house and car.
Question: How often can you file a Chapter 7 bankruptcy?
Answer: Every eight years. A new Chapter 13 bankruptcy can be filed every four years.
Question: If I’m married, can I file a Chapter 7 bankruptcy individually?
Answer: If one spouse has incurred a substantial amount of debt on their own behalf, they can file for bankruptcy independently. However, the income and expenses of the non-bankrupt spouse must be included for reporting purposes only. The spouse’s assets and debts are separate from their bankruptcy petition.
Question: What does it mean if my debt is discharged in Chapter 7?
Answer: In Chapter 7, the discharged debt is eliminated, and you will not be personally liable for it.
Question: What types of debt are not discharged in Chapter 7 bankruptcy?
Answer: Examples of debts that are not discharged in Chapter 7 include federally guaranteed student loans, child support and alimony, and IRS debts from the past three years.
CHAPTER 13
Question: What benefits can you expect from filing for Chapter 13 bankruptcy?
Answer: Filing for Chapter 13 bankruptcy offers several advantages, including:
- If the market value of your home is less than the value of your first mortgage, a second mortgage or line of credit can be eliminated entirely.
- If your home is in a Homeowners Association zone, maintenance arrears can be eliminated.
- If you own more than one property, you can keep those additional properties or investment properties by paying the court within your repayment plan, such mortgages reducing the debt to current market value.
- A modification can also be filed to reduce mortgage payments on your primary home by adjusting your monthly payments to meet regulations.
Question: Will I lose all my assets if I file for Chapter 13 bankruptcy?
Answer: A Chapter 13 bankruptcy allows you to keep your home, your retirement plan, your car, and your personal property. The court requires you to pay a portion of your debt over a period of 3-5 years. Your home cannot be sold to pay off the remaining debt.
Question: How often can you file for Chapter 13 bankruptcy?
Answer: Every two years, if you’ve complied with your payment plan and the bankruptcy is finalized. Perhaps six months after your case was dismissed by the court.
Question: If I’m married, can I file Chapter 13 bankruptcy individually?
Answer: If one spouse has incurred a substantial amount of debt on their own behalf, they may file for bankruptcy individually. However, the income and expenses of the non-bankrupt spouse must be included for reporting purposes only. The spouse’s assets and debts are separate from their bankruptcy petition.
Question: To whom should I make monthly payments during a Chapter 13 bankruptcy?
Answer: A trustee is appointed by the court, and all payments are made to the trustee.