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Bankruptcy Attorney in Jacksonville FL
When your creditors are threatening to sue and you see no way to pay off your debts, you do have an option at your disposal that can give you relief. Once you declare bankruptcy, all creditor actions against you must stop. That includes harassing phone calls, lawsuits, wage garnishments, repossessions, and foreclosures.
At Gahanian Law, PA we represent debtors when their debts have spiraled out of control. This gives you a chance to either discharge the debts entirely or construct a repayment plan on some of your debts that is within your means. If you need debt relief, an experienced Jacksonville FL bankruptcy attorney can help. Contact us today.
What Are Your Options?
There are two main options for bankruptcy for individual filers and couples: Chapter 7 and Chapter 13. Chapter 11 is generally reserved for businesses.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy is also known as liquidation bankruptcy. Under Chapter 7, you can discharge the majority of your unsecured debts (which are not secured against a property like your mortgage or a car loan). Common examples of unsecured debts include repossessed or voluntarily surrendered vehicles, medical expenses, and credit card debt. Chapter 7 is a legal process designed to give consumers a fresh start on their finances.
What Is the Means Test?
When filing under Chapter 7, individuals are required to pass a means test in order to prove that they are unable to repay their debts. The means test serves to protect creditors’ interests.
The means test first determines if your yearly household income is above or below that median income for a family of your size in the state of Florida. This number is recalculated yearly. All houses that are below the median income qualify for a chapter 7. Some households that are above the median income also qualify. The determination is a complicated one and depends on many factors including the type of debt owed. Gahanian Law, PA can help you understand your options and help you determine your eligibility.
Understanding Chapter 7 Liquidation
If you qualify for Chapter 7, the bankruptcy trustee will determine what (if any) assets, they can liquidate to repay your creditors. You should not attempt to hide assets from the bankruptcy trustee. There are legal means of protecting assets.
In addition, you can exempt certain property from liquidation. Florida provides debtors with a list of exemptions, as does federal law. Exemptions include the following:
- Homestead property (your home up to a certain amount of acreage);
- Property held as tenancy by the entirety can be protected against one spouse’s debts;
- Death benefits paid to a single beneficiary;
- Disability, illness, or Social Security benefits;
- Unemployment or other public benefits;
- Workers’ compensation benefits;
- Veterans’ benefits;
- The value of a surrendered life insurance policy;
- Alimony and child support;
- Pre-need funeral deposits;
- ERISA long-term disability benefits;
- Pensions of:
- County officers or employees,
- Police officers, and
- Highway patrol officers;
- Personal property up to $1000 (or $5000 if the homestead exemption is not used) per spouse;
- Property related to health care;
- Federal survivors benefits; and
- 75% of earned but unpaid wages.
Gahanian Law, PA will review your assets BEFORE you file and determine if the Trustee will have an interest in any of your property.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy is also called reorganization bankruptcy. Think of it like debt consolidation, but with the backing of the federal government and creditors cannot opt-out. Unlike Chapter 7, there are no limits on how much you earn. There are, however, limits on how much you owe. In order to qualify for Chapter 13 you must owe less than:
- $394,725 in unsecured debts; and
- $1,184,200 in secured debts.
Chapter 13 is ideal for those who are in arrears on secured debt and in danger of losing their property as it calls for a repayment plan over 3- 5 years. Certain debts are often given priority over others. Generally, all unsecured debt will be paid a percentage of what is owed. You may also qualify for a “cramdown” which reduces the amount of money you owe on a secured property. Under Chapter 13, your debts will be considered discharged once the three- or five-year plan is completed.
What Debts Can I Not Discharge in Bankruptcy?
Debts can be divided into a few categories. Those that can:
- Be discharged under any kind of bankruptcy;
- Only be discharged under Chapter 13 or Chapter 11;
- Only be discharged if you can prove hardship; and
- Never be discharged at all.
Debts that cannot be discharged include:
- Child support and alimony;
- Criminal fines and administrative penalties;
- Restitution owed in a criminal case;
- Certain kinds of tax debts; and
- Wrongful death due to drunk driving judgments.
In addition, there are some debts that are rarely discharged but, if you can show that you qualify for an exemption, the court may discharge the debts anyway. You will need to prove that some hardship prevents you from repaying the debt. The most likely culprit is a prolonged illness. These include:
- Student loans and
- Federal income tax.
In addition, any debt not listed in your bankruptcy will not be discharged in the bankruptcy.
Creditor Objections and Bankruptcy Discharge
Creditors have a limited ability to object to the discharge of debts under Chapter 7 or a reorganization plan under Chapter 13. To successfully object, the creditor must show that the debts were acquired under fraudulent pretenses, willful or malicious acts, or they were incurred due to larceny, fiduciary breach, or embezzlement.
A Jacksonville FL Bankruptcy Attorney Can Help You Regain Control of Your Finances
At Gahanian Law, PA, we understand that bad debts happen to good people. We can help you get a fresh financial start. We can also help you rebuild your credit once your debts have been discharged. Contact us to talk to a Jacksonville FL bankruptcy attorney today.
About Talia Gahanian, Esq.
I graduated cum laude from Cleveland Marshall College of Law in 2007 and am licensed in both Ohio and Florida. I am a member of the American Bar Association and the National Association of Consumer Bankruptcy Attorneys. In my free time, I am active in my local synagogue and enjoy hiking and going to the beach with my four children.