Chapter 7
Chapter 7 Bankruptcy
Chapter 7 Bankruptcy can be filed by an individual, partnership, corporation, or business entity. This type of Bankruptcy allows you (also known as the “debtor”) to liquidate your assets, meaning all assets, except those which are exempt, are sold, and the proceeds are systematically distributed to creditors to satisfy all or a portion of the debt. In exchange, all unsecured debt is eliminated, and the debtor is no longer responsible for paying off those debts.
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Chapter 7 Bankruptcy in Florida
Bankruptcy in Florida is a legal process where most of your debts are eliminated (“discharged”) in exchange for selling off some of your assets. Here’s a quick breakdown:
Pros:
- Debt Discharge: Most unsecured debts like credit cards, medical bills, and personal loans are wiped clean.
- Fresh Start: Provides financial relief and a chance to rebuild your credit.
- Stop Creditor Harassment: Collection activity and lawsuits from creditors are halted.
Cons:
- Asset Liquidation: Some non-exempt assets like a second car or expensive jewelry might be sold.
- Credit Score Impact: Filing for bankruptcy stays on your credit report for 10 years and can negatively impact your score.
- Eligibility Requirements: You must pass a means test to qualify based on your income and expenses.
Florida Specifics:
- Exemptions: Florida has generous exemptions that allow you to keep more property compared to other states.
- Homestead Protection: Your primary residence is generally protected from liquidation with certain value limits.
- Fees: There are court filing fees associated with the process.
Contact Mario Gunde Peters & Kelley for assistance.
