Chapter 7 Bankruptcy is often used as a simple way to eliminate debt and start financially fresh. A Chapter 7 Bankruptcy, also known as a “liquidation” or "straight" bankruptcy, allows a debtor to eliminate most of his or her debt and once filed is usually complete in three to six months.

The Bankruptcy Court charges a small fee to file a Chapter 7, but it can be waived if the debtor is unable to afford it. Once the petition is filed, the court appoints a person, called a "trustee", to supervise the administration of the bankruptcy.

In a Chapter 7 Bankruptcy the assets of the person filing for bankruptcy (debtor) are generally taken and sold with the proceeds distributed among the debtor’s creditors. However, in practice most debtors do not lose much or any of their property. This result can be achieved by using one of many important exemptions that protect consumers.

 

Basic Information:

 

a.    Chapter 7 is designed for debtors with financial difficulties that do not have the ability to pay their existing debts. Debtors whose debts are primarily consumer debts are subject to a “means test” designed to determine whether the case should be permitted to proceed under chapter 7. If your income is greater than the median income for your state of residence and family size, in some cases, creditors have the right to file a motion requesting that the court dismiss your case under § 707(b) of the Code. It is up to the court to decide whether the case should be dismissed.

b.   Under chapter 7, you may claim certain of your property as exempt under governing law. A trustee may have the right to take possession of and sell the remaining property that is not exempt and use the sale proceeds to pay your creditors.

c.    The purpose of filing a chapter 7 case is to obtain a discharge of your existing debts. If, however, you are found to have committed certain kinds of improper conduct described in the Bankruptcy Code, the court may deny your discharge and, if it does, the purpose for which you filed the bankruptcy petition will be defeated.

d.   Even if you receive a general discharge, some particular debts are not discharged under the law. Therefore, you may still be responsible for most taxes and student loans; debts incurred to pay nondischargeable taxes; domestic support and property settlement obligations; most fines, penalties, forfeitures, and criminal restitution obligations; certain debts which are not properly listed in your bankruptcy papers; and debts for death or personal injury caused by operating a motor vehicle, vessel, or aircraft while intoxicated from alcohol or drugs. Also, if a creditor can prove that a debt arose from fraud, breach of fiduciary duty, or theft, or from a willful and malicious injury, the bankruptcy court may determine that the debt is not discharged.

e.  Fees: ($245 filing fee, $39 administrative fee, $15 trustee surcharge: Total fee $299).

 

Exemptions

 

There are several exemptions available to Florida residents. Listed below are some of the most important exemptions:

• Houses and cars
• 401K retirement and pension funds
• Workers' compensation awards
• Prepaid college funds
• Supplemental Security Income (SSI) or disability income

Florida law provides one of the most comprehensive listing of exempt property of any state in the U.S. Although there are some limitations debtors will not only eliminate debt, they will also be able to keep most or all of their possessions.

 

Bankruptcy does not clear or discharge ALL debts, it does not discharge child support, student loans, drunk driving debts, and some types of federal taxes.

 

At Corzo and Kohrs we can help you understand how the new bankruptcy laws apply to your unique financial situation.

Before you file for Chapter 7 bankruptcy and to properly assist you with your filing you must provide your attorney with the following documents/information:

• Paystubs (6-7 months)
• Bank statements (12 months)
• Check register(s) (12 months)
• Life insurance policies
• 401K, Pension, Retirement, IRA statements (most recent)
• Lawsuits
• Bluebook value of your vehicle(s) (can be found at www.kbb.com)
• Tax returns (previous 2 years)

Consult With an Experienced Kissimmee Bankruptcy Attorney

 

If you find yourself in financial trouble now is the time to take action. We will conduct a thorough review of your financial situation to determine whether Bankruptcy is right for you. Contact Central Florida Bankruptcy attorney Will Corzo or Sam Kohrs toll free 877-99CK-LAW for a free consultation and explanation of your rights. 

 

When visiting our office for an initial consultation, it is important that you bring the following documents and information:

• Recent paystub
• Recent creditor statements (including mortgage, vehicles, student loans)
• List of monthly expenses
• Real estate market value of your property

 

The Central Florida law firm of Corzo and Kohrs practices in Consumer and Individual Bankruptcy throughout central Florida, including clients from Orange County, Osceola County, Seminole County, Polk County, and Pinellas County and in cities such as Orlando, Kissimmee, St. Cloud, Poinciana, Celebration, Hunter’s Creek, Ocoee, Oviedo, Avalon Park, Windermere, Altamonte Springs, Baldwin Park, Clermont, Winter Park, St. Petersburg, Seminole, Clearwater, including clients from schools such as University of Central Florida UCF, University of South Florida USF, Valencia Community College, Full Sail, and other Central Florida schools. Attorneys are available 24 hours a day and on weekends and holidays.