Who can file bankruptcy?
Any person who resides, domiciled, or having property or a place of business in the United States may file for bankruptcy relief.
What is a Chapter 7 bankruptcy?
Chapter 7 bankruptcy is the most common type of bankruptcy and is often referred to as a “liquidation bankruptcy.” In Chapter 7, all of the debtor’s assets, other than those types of assets specifically exempt from liquidation by statute, are turned over to a bankruptcy trustee for sale. Sale proceeds, if any, are distributed among the creditors. Most Florida Chapter 7 debtors have little non-exempt personal property because of Florida’s liberal exemption laws. Chapter 7 bankruptcy is used to eliminate, or discharge, primarily unsecured debts such as credit cards or medical bills. Chapter 7 does not eliminate secured debts, such as vehicles (unless the secured item is surrendered). Chapter 7 will not save a house from foreclosure or a car from repossession if you are delinquent in payments. Under the new bankruptcy law, only people who pass the “means test” may file a Chapter 7 bankruptcy. People who fail the means test have to file Chapter 13 bankruptcy provided you are under Chapter 13 debt ceilings. The means test is a complicated mathematical formula. Your bankruptcy attorney can run a means test using bankruptcy software after he collects necessary information from you. For more info CLICK HERE.
What is a Chapter 13 bankruptcy?
Chapter 13 bankruptcy results in a plan to repay all or part of your debt, but it is not designed to discharge or eliminate most debts. Chapter 13 is used most often to save a house from a foreclosure sale. You can use Chapter 13 to “strip” a second mortgage under certain circumstances. Chapter 13 is also useful to eliminate some IRS debt and to establish an affordable plan to pay IRS debt that cannot be eliminated. Chapter 13 bankruptcy is available to debtors with regular income. A business cannot file Chapter 13. In addition, there are upper limits on the amount of the individual’s secured and unsecured debts in Chapter 13 cases.
Bankruptcy – Before Filing
Unfair Debt Collection
The Federal Fair Debt Collection Practices Act (the “Act”) prohibits unfair collection of consumer debts. If you can prove that your creditors intentionally and repeatedly violated the Act before or after you retained your bankruptcy attorney, you may be able to recover damages. The following is a summary of a few prohibited debt collection practices:
- Calling you before 8 a.m. or after 9 p.m. local time.
- Contacting you directly after you told the creditor you retained an attorney to represent you.
- Telling your employer or co-worker that you owe money to the creditor.
- Calling you at work after you have told them not to.
- Intentional and continuous harassment or abuse in connection with a debt.
- A creditor’s representative falsely representing that he is an attorney when in fact he is not licensed to practice law.
- Threatening you with arrest or imprisonment for failing to pay a debt.
- Communicating with anyone other than you our your spouse about your debt.
The debt collection laws are complicated, and your right to recovery will depend on your specific facts and your evidence. Contact your bankruptcy attorney if you believe you can prove one of your creditors intentionally and repeatedly engaged in unfair collection practices. A copy of the complete Act is available at http://www.ftc.gov under Consumer Information.
Use of Credit Cards.
Do not use any credit cards after the initial consultation with your bankruptcy attorney or once you have decided to file bankruptcy. If you have charges or cash advances in the months preceding filing bankruptcy, the creditor may file an adversary complaint alleging that you incurred recent charges with fraudulent intent and without the intent and/or ability to repay these debts.
Relatively recent changes in the bankruptcy law (effective October 17, 2005) has complicated the bankruptcy process. Revisions to the bankruptcy laws have instituted stricter rules with regard to qualifying for bankruptcy relief, while implementing new court rules, forms, and additional work for debtors and legal counsel. With the revisions to the bankruptcy laws, the rules and procedures are sometimes confusing, ambiguous and subject to multiple interpretations. The information contained herein is specific to cases filed in the Middle District of Florida. This basic information should assist you in understanding the course of events that occur when you file bankruptcy. The information is provided for informational purposes only, and you are strongly encouraged and recommended to secure the advise of legal counsel before making any decisions. This website information does not replace or modify any separate written agreement with or written information provided to clients of Campione & Hackney, P.A.