How Does Chapter 7 Work in Florida?
Chapter 7 bankruptcy Florida (i.e., Liquidation bankruptcy or straight bankruptcy) is a legal procedure that can help most people eliminate most of their non-exempt debts. There are federal bankruptcy laws and state bankruptcy laws. In terms of Chapter 7 bankruptcy Florida, there are specific laws in place that differ from other states.
It’s much easier to choose the right debt relief options for your specific situation when understanding the differences between Florida, other states, and federal codes. Here, we’ll take a look at the process, general requirements, and potential benefits of filing Chapter 7 in Florida.
Need additional help? Our Chapter 7 bankruptcy lawyers in Clearwater and Tampa are here to help. Give us a call today to discuss your circumstances and options.
What is Chapter 7 Bankruptcy?
Commonly called a “liquidation” bankruptcy, chapter 7 involves a court appointed trustee selling your non-exempt property to pay off your creditors (in part or full). The goal of this process is to discharge most of your unsecured debts (i.e., credit card balances, medical bills, personal loans, etc.). After you’ve received a full discharge, you’re not legally required to pay those debts.
However, there are some notable non-dischargeable debts, including:
- Student loans
- Child support and alimony
- Most tax debts
- Government penalties and court fines
- And others
If you’re unsure whether your debt qualifies for Chapter 7 discharge, it’s recommended that you speak with a proven bankruptcy attorney to review the details of your case.
Chapter 7 Florida Eligibility Requirements
If you’re considering filing Chapter 7 in Florida, you’ll need to meet certain criteria. Mainly, filers must pass the Chapter 7 means test Florida. The purpose of this “test” is to ensure your income is low enough to file under this chapter. If your income surpasses this threshold, you might not be eligible for Chapter 7 and instead may need to consider other debt relief options, like Chapter 13.
- Income Requirements: If your income is lower than the median income in Florida (based on household size), you may automatically qualify for bankruptcy. However, if it’s above the median, you’ll need to move to the next steps in the means test to determine eligibility.
- Debt Limitations: There are no limits placed on the amount of debt you can get discharged through the bankruptcy process. However, it’s essential to ensure the debt you’re seeking to discharge and other details of your situation qualify under federal or Florida bankruptcy laws for Chapter 7.
Additional Florida Chapter 7 Requirements
The means test is just one step in the qualification process. In addition, you’ll need to meet other requirements before you file and/or receive a discharge. They include:
- Completing a credit counseling course
- Completing a financial management course
- Paying all applicable filing fees or receiving a fee waiver
Chapter 7 Bankruptcy Exemptions Florida
There’s nothing worse than the thought of losing your home, car, or sentimental property due to filing bankruptcy. The good news is there are federal and state exemptions (you’ll have to choose which to apply to your case) that can help to protect some of your most precious assets. Among other states, Florida bankruptcy laws Chapter 7 provide some of the most generous exemptions.
Some of the most common Chapter 7 bankruptcy exemptions Florida include:
- Homestead Exemption: Allows unlimited protection for the full value of your primary residence, as long as the property doesn’t exceed a certain acreage.
- Personal Property Exemptions: If you’re claiming the homestead exemption, you can also exempt up to $1,000 of your personal property. Otherwise, you can claim up to $4,000.
- Vehicle Exemption: You can exempt up to $1,000 in equity for a vehicle.
Understanding exemptions and other
Chapter 7 bankruptcy rules in Florida
can help you keep your most important assets while discharging other debts.
The Chapter 7 Process in Florida
If you’re not a seasoned attorney, filing Chapter 7 can be an arduous process filled with complexity and doubt. On the other hand, working with a professional can help ensure you meet all deadlines, provide accurate financial documents, and meet all the requirements.
Every case is slightly different, but the general Chapter 7 process in Florida involves:
- Hire a Chapter 7 lawyer Florida (not required, but recommended)
- File your bankruptcy petition, including highly detailed financial documents
- Receive an automatic stay, which puts an immediate stop to all debt collection activities
- Attend a 341 Meeting of Creditors with your trustee and creditors
- Your trustee liquidates (i.e., sells) your non-exempt assets to pay creditors back
- You receive a Chapter 7 discharge of all qualifying debts
- Your case is concluded and all eligible debts are wiped out
Ready to get started on your path to financial recovery? Contact The Attorney Debt Fighters today to learn how we can help.
How Long Does Chapter 7 Take in Florida?
The entire Chapter 7 timeline in Florida can vary depending on the complexity of your case, but most are resolved within three to six months from the time you file. However, some cases can take much longer. Your specific timeline depends on:
- Whether there are any mistakes in your application
- The amount of assets you have
- The complexity of your assets
- Disputed exemptions
- Your trustee’s review process
While there are some occasions where Chapter 7 takes longer than a few months, it’s generally the fastest option compared to other bankruptcy chapters.
A Fresh Start After Chapter 7 Discharge
You won’t have to pay debts that have been discharged. However, it will still take work, time, and savvy financial decisions to start the process of rebuilding your credit post-bankruptcy. During this time, it’s essential that you:
- Create a budget, and stick as close to it as possible
- Eliminate debts that were not included in your filing
- Pay your bills on time
- Avoid opening new lines of credit and accumulating new debts
Most people start to see a credit score improvement within the first one or two years after filing for bankruptcy.
Consult With a Chapter 7 Lawyer in Florida Today
Whether you’re just wondering how Chapter 7 works in Florida or you need assistance filing, the skilled attorneys at Ziegler Diamond Law are here to help you recover and thrive financially. When you work with us, you can expect:
- Help understanding Chapter 7 bankruptcy rules Florida
- Assistance completing and filing necessary documents
- Advice on the best way to maximize your exemptions
- Legal representation during the 341 Meeting of Creditors
- Help addressing any objections from creditors or your trustee
Start your journey to financial recovery today. Contact The Attorney Debt Fighters today to schedule your free consultation with a Chapter 7 bankruptcy attorney in Tampa Bay, Clearwater, and the surrounding areas.
