Chapter 7 Bankruptcy
1. Chapter 7 Bankruptcy - What is Chapter 7 bankruptcy?
2. Chapter 7 Bankruptcy - Who can file Chapter 7?
3. Chapter 7 Bankruptcy - What are the requirements to file Chapter 7 bankruptcy?
4.Chapter 7 Bankruptcy - Do I qualify for the Florida exemptions?
5. Chapter 7 Bankruptcy - Does the debtor need to be insolvent to file?
6. Chapter 7 Bankruptcy - What is the monthly income analysis?
7. Chapter 7 Bankruptcy - What are the median family incomes for Florida?
8. Chapter 7 Bankruptcy - What if I am below or equal to the median family income for Florida?
9. Chapter 7 Bankruptcy - What if I am above the median family income for Florida?
10. Chapter 7 Bankruptcy - What are some of the allowable exemptions in Florida?
11. Chapter 7 Bankruptcy - What debts are discharged?
12. Chapter 7 Bankruptcy - What debts are non-dischargeable?
13. Chapter 7 Bankruptcy - What happens after filing?
14. Chapter 7 Bankruptcy - What is the automatic stay?
15. Chapter 7 Bankruptcy - What is a 341 meeting?
16. Chapter 7 Bankruptcy - What is the time frame for a Chapter 7 bankruptcy?
17. Chapter 7 Bankruptcy - How can I contact Shmucher Law, PL to schedule a consultation?
What is Chapter 7 bankruptcy?
Chapter 7 bankruptcy is a straight liquidation proceeding for an individual. Under Chapter 7, the debtor receives a discharge from all dischargeable debts, but must turnover all nonexempt property to the bankruptcy trustee.
Who can file Chapter 7?
An individual consumer can file for Chapter 7 bankruptcy and obtain a discharge.
A corporation may file for Chapter 7 bankruptcy but a discharge will not be granted, only an orderly liquidation of assets will occur.
What are the requirements to file Chapter 7 bankruptcy?
In order to qualify for bankruptcy relief the debtor must reside or have a domicile, a place of business, or property in the United States. Furthermore the debtor could not have been granted a Chapter 7 or Chapter 11 discharge within the preceding eight years.
Do I qualify for the Florida exemptions?
In order to quality to receive the Florida exemptions the debtor must be a resident of the state of Florida. In order to be considered a resident the debtor must have lived in Florida for the past two years or 730 days.
Does the debtor need to be insolvent to file?
There is no requirement that the debtor need to be insolvent to file for bankruptcy. However 11 U.S.C. § 707(b) allows the court to dismiss a consumer bankruptcy case if finds that granting the relief would be an abuse of the bankruptcy provisions.
What is the monthly income analysis?
The debtor’s income will be analyzed to determine if the debtor can pay back creditors in a Chapter 13 plan rather than a straight liquidation Chapter 7 plan. The analysis averages the debtor’s previous six months of income. If the debtor’s average income suggests that the debtor has disposable income, to pay back creditors, then the debtor will become ineligible to file a Chapter 7 petition.
The debtor’s current monthly income is then added to the debtor’s spouses income (if applicable) and multiplied by 12 to obtain an annualized family income. The annual family income is then compared to the median Florida income of a family of the same size.
What are the median family incomes for Florida?
Individual earner - $41,226
Family
Two people – $52,259
Three people - $58,574
Four people - $68,009
Five people - $75,909
Six people - $82,809
What if I am below or equal to the median family income for Florida?
The debtor will likely be able to file for Chapter 7 bankruptcy
What if I am above the median family income for Florida?
If the debtor is above the median family income for Florida then another formula, known as the means test, will be applied. See the means test explanation.
What are some of the allowable exemptions in Florida?
Homestead: any natural person may claim the homestead exemption as long as the property is:
Under 160 acres if located outside a municipality
Under ½ an acre if located within a municipality
Personal property: Florida’s Constitution authorizes a person to exempt property to a value of $1,000 (joint husband wife can each claim $1,0000)
Other exemptions:
Life insurance proceeds
Disability income benefits
IRA, 401k
Pension plans
Prepaid college plans
Any property that is owned as tenancies by the entireties
What debts are discharged?
All debts that don’t qualify as non-dischargeable including medical bills, credit card debts, or other unsecured debts.
What debts are non-dischargeable?
Certain taxes
Student loans
Domestic support obligations
Certain behavior based debts
What happens after filing?
Upon the filing of the Chapter 7 bankruptcy petition the automatic stay is enforced
Approximately 30 days after filing a Chapter 7 bankruptcy petition a 341 meeting is held. Approximately 90 days after filing the debtor receives his discharge in the mail.
What is the automatic stay?
The automatic stay prohibits the following actions from occurring:
- collection proceedings on prepetition claims against the debtor
- enforcement of judgments against the debtor or property of the debtor
- any action to obtain possession of or control of the property of the estate
What is a 341 meeting?
The 341 meeting gives the trustee and any creditors the opportunity to question the debtor regarding his bankruptcy schedules, assets or liabilities.
What is the time frame for a Chapter 7 bankruptcy?
The entire Chapter 7 process taxes approximately 90 days, from filing to discharge.
How can I contact Shmucher Law, PL to schedule a consultation?
Call our office at 954-309-5559 to schedule an initial consultation. During the initial consultation we will review all your options to get you out of debt including creditor negotiation, Chapter 7 bankruptcy or Chapter 13 bankruptcy filing.
Shmucher Law, PL, a bankruptcy law firm, represents debtors, creditors, and trustees in bankruptcy matters throughout Broward and Miami-Dade counties.