BANKRUPTCY

You may not have considered bankruptcy. But, if you’ve experienced unexpected, extreme financial shock, possibly caused by sudden job loss, escalating mortgage payments, business failure, death, divorce or illness, filing bankruptcy may be the right solution for you. It’s important to seek the counsel of an experienced bankruptcy attorney to help you deal with your legal options.

At DeZayas Friel, we’ll help you face those serious financial challenges.
We assist you in determining whether or not bankruptcy is the right option. If so, we’ll file to relieve you of your debt, and help you to reestablish your credit and financial health after the bankruptcy.

BANKRUPTCY OPTIONS

Learn more about the two different types of bankruptcy, Chapter 7 and Chapter 13, by clicking below. Or, contact us at 863-904-4710 to discuss your options.

Filing Chapter 7 bankruptcy allows you to obtain a discharge of debts such as credit card bills, lawsuit judgments, payday loans and hospital bills.

Under the new laws, you must first pass a means test to file Chapter 7 bankruptcy.  If your current monthly income is below the Florida adjusted median income, you can file Chapter 7.  However, even if your income is above the Florida adjusted median income, you may still be able to file after expenses such as car payments and retirement plan contributions are deducted from your income.  We have helped many people file Chapter 7  after other attorneys told them they did not qualify due to the means test.

Chapter 7 is sometimes referred to as “liquidation” bankruptcy because the bankruptcy trustee can seize assets to pay your debts.  However, certain property is exempt from seizure in Florida.  Exempt property includes all equity in your home, up to $1,000 equity in your car, and up to $1,000 in other personal property ($4,000 if you do not claim the Florida homestead exemption).  We are very skilled at using exemptions to help our clients retain important items.

In additional to eliminating unsecured debt, Chapter 7 bankruptcy puts an immediate stop to:

  • Home Foreclosure
  • Eviction
  • Wage garnishment
  • Repossessions
  • Creditor harassment

There are many reasons why you may choose to file Chapter 13 instead of Chapter 7 bankruptcy:

  • You may not qualify for Chapter 7 under the means test.
  • Filing Chapter 13  may allow you to protect assets you would
    otherwise lose by filing Chapter 7.
  • Chapter 13 bankruptcy gives you more time to catch up on mortgage
    payments to prevent a home foreclosure.
  • There are some tax debts you can discharge in a Chapter 13
    that can’t be discharged in Chapter 7.

Creating a Debt Repayment Plan

Under your Chapter 13 bankruptcy payment plan, you will agree to pay back a percentage of your secured debt over a three to five year period.  Secured debt is debt backed by certain property, such as your home and your car.

After you and our lawyer have determined a budget, you will pay back a percentage of your unsecured debt such as credit card bills, lawsuit judgments, payday loans and hospital bills.  This percentage will be determined by how much you can afford to pay.  Chapter 13 bankruptcy plan is a form of debt consolidation, as you will make one payment to the bankruptcy trustee, who will them pay your creditors.  At the end of the payment plan, remaining unsecured debts will be eliminated and you will be up to date on your secured obligations.

What Are the Other Benefits of Chapter 13?

Filing Chapter 13 bankruptcy puts an immediate stop to:

  • Home Foreclosure
  • Eviction
  • Wage Garnishment
  • Repossessions
  • Harassment by your creditors

Means Test

The first part of the means test is simply a comparison:  How does your household income compare to the median income in Florida for a family the same size as yours?  On March 15, 2014, the U. S. Department of Justice released its official annual adjusted median income data.  In Florida, the median income data is:

  • $40,029 for a household of one
  • $50,130 for a household of two
  • $54,594 for a household of three
  • $65,135 for a household of four or more

In the second part of the means test, certain expenses are deducted (subtracted) from your gross income to arrive at your disposable income.  If your projected disposable income for the next five years is less than $100 a month ($6,000 total), you most likely pass the test and are eligible to file for Chapter 7.  If your disposable income projects to be more than $10,000, you likely will not be eligible.

Discharge

Most people who file bankruptcy do so to discharge their debts.  A discharge is a court order, which states that you do not have to pay a debt.

Some debts virtually cannot be discharged.  For example, you typically cannot discharge debts for:

  • Most taxes
  • Child support
  • Alimony
  • Student loans
  • Personal injury lawsuit judgments caused by driving under the influence of drugs or alcohol.

Discharge of debts through bankruptcy only applies to debts that arose before the date you filed.  Also, if the judge finds that you received money or property by fraud, that debt may not be discharged.

You can only receive Chapter 7 bankruptcy once every eight years.  No one can make you pay a debt that has been discharged, but you can voluntarily pay any debt you wish to pay.  You do not have to sign a reaffirmation agreement or any other kind of document to do this.

OFFICE HOURS

8:00am – 5:00pm

OFFICE HOURS

8:00am – 5:00pm