- September 15, 2023
- Thomas Adam
The right time to declare bankruptcy typically occurs once you have used all possible sources to settle your debts, but are still unable to do so. If you have significant unpaid debts, are falling behind on your mortgage and possibly risk foreclosure, and/or are receiving collection calls, it is time to speak with a local Florida bankruptcy attorney. While bankruptcy can have serious repercussions on your credit rating, it also has the ability to wipe out your debts and help ensure that you do not lose your home and other property.
Consumers most frequently rely on declaring either Chapter 7 or Chapter 13 bankruptcy. Chapter 7 is the most common type of bankruptcy pursued. Known as liquidation, creditors and lenders are partially reimbursed via some of your assets and property, while remaining financial obligations are discharged. Some of your assets and property are off limits from liquidation, such as your personal belongings, pension, home equity, and your vehicle. When you declare, you work with your attorney to set aside these items that you claim to be exempt.
Declaring Chapter 13 bankruptcy, you and your attorney work out a court-ordered repayment plan that covers a percentage of your financial obligations over a three-to-five-year period, while others are potentially discharged. Chapter 13 does not call for the liquidation of your assets – as a result, you are typically enabled to keep your home.
There are several stages involved in declaring bankruptcy, including the following:
- Undergoing credit counseling programs: This can include counseling from your bankruptcy attorney, who can help provide you with guidance on establishing a financial plan and managing debt, and go over your bankruptcy options
Along with filing your bankruptcy petition, you will need to file financial statements that break down your assets, income, and obligations
- Your attorney will also likely help you with a means test to assess whether your earnings allow you to be approved for Chapter 7 bankruptcy. If you do not qualify to file for Chapter 7, you will need to work with your attorney to file for Chapter 13 bankruptcy
- After you file, the court-appointed trustee schedules a meeting of lenders in order to allow them the opportunity to make inquiries about your financial status and arrangements for repayment
- The bankruptcy court issues a verdict based on the information you’ve submitted
- You will need to complete a debtor education program
- When obligations are discharged, lenders can no longer try to reclaim the debts
Contact Our Jacksonville, Florida Bankruptcy Law Firm with Questions
The Jacksonville, Florida Adam Law Group is here to help – we have saved our clients’ homes from being auctioned, and we provide free consultations and the very best in customer service. Our team is here to help: Contact us today to schedule your free consultation.