Legal Guidance for Fort Lauderdale Residents Considering Bankruptcy
Many people file for bankruptcy if they lose their jobs or suffer a loss of income. If you are in this position, the bankruptcy process may help you get back on your feet. The bankruptcy lawyers at Anidjar & Levine provide counseling to Florida residents who have lost their income and are struggling to pay their bills. We can answer your questions on whether bankruptcy can help you manage your debt and start anew.
How Chapter 7 Bankruptcy Offers Unemployment Protection
If you are unemployed, you may be able to file for bankruptcy under Chapter 7. In a Chapter 7 bankruptcy, your non-exempt assets are sold, or liquidated, and your creditors are paid from the proceeds of the sale. Most debtors do not have enough assets to pay their creditors. In other words, once all your property is sold, there may not be enough money to pay off all your debt. If you complete Chapter 7 successfully, however, any remaining debt left after the proceeding is discharged. You would have no further obligation to pay any outstanding debt you owe a creditor, unless it is a non-dischargeable debt like child support.
Since Chapter 7 wipes out most unpaid debts, the law requires that you pass a means test to apply under Chapter 7 in the first place. This is to prevent people who can pay for some of their debt from abusing Chapter 7 and eliminating their debt altogether. If you are unemployed or have a substantial loss in income, however, you are less likely to raise a presumption of abuse under the means test.
The means test looks at your income from the six months prior to your filing. If you are unemployed, you are more likely to be eligible for Chapter 7 bankruptcy and can complete the process within a matter of months. If you are receiving unemployment benefits, however, a Florida court may consider it income for purposes of the means test. A bankruptcy attorney can look at your particular situation and advise you on whether you may qualify for Chapter 7.
How Chapter 13 Bankruptcy Offers Unemployment Protection
Many debtors prefer filing for Chapter 7 because of its speedy elimination of debt. There are circumstances, however, when filing for Chapter 13 may be more appealing. Under Chapter 13 bankruptcy, you can reorganize your debt and prevent the loss of certain assets. You can propose a debt repayment plan that explains how you intend to pay your creditors over the course of three or five years. You will make monthly payments to a court-appointed bankruptcy trustee, who will then pay your creditors.
By reorganizing your debt and making some payments, you can keep some of your property. For example, you can avoid foreclosure of your home if your debt repayment plan includes provisions for catching up on any arrears and if you continue to make your mortgage payments.
This is where it can get complicated for a person with no income. Chapter 13 allows you to keep your property as long as you have the financial means to make your monthly payments. Income from employment is usually the main source of income for most individuals, but income can also include rental income or Social Security benefits. However, if you cannot make your monthly payments through other sources of income, your proposed repayment plan is unlikely to receive court approval. A bankruptcy lawyer can discuss the benefits of Chapter 13 bankruptcy and whether you may be able to complete a three-year or five-year repayment plan given your unique situation
Hollywood Bankruptcy Lawyers Committed to Helping You
At Anidjar & Levine, our bankruptcy attorneys understand how the loss of a job or other source of income can create a hardship for Hollywood residents. We can assess your case and advise you on whether filing for bankruptcy can alleviate some of the burden. Our attorneys provide representation in Chapter 7 and Chapter 13 bankruptcy. We can work toward a quick and smooth liquidation or help you develop an appropriate repayment plan. We serve clients throughout Miami-Dade and Broward Counties. For a free and confidential consultation, call us today at 800-747-3733 or complete our Contact Us form.