The Noble Law Firm assists individuals in filing both Chapter 7 and Chapter 13 bankruptcies. In 2005 the Bankruptcy Code drastically changed and now one has to qualify to file a Chapter 7 bankruptcy. If one is facing many debts including credit card debts and deficiency judgments, bankruptcy may be the best option. The Noble Law Firm can determine whether an individual qualifies for a Chapter 7 bankruptcy under the new Means Test.
Once a debtor has filed a chapter 7 bankruptcy petition, the U.S. Bankruptcy Court will appoint a trustee. The trustee is required to review the assets and debts of the debtor or debtors and also mediate discussions with creditors of the debtors’. Additionally, trustees are in charge of liquidating assets, if there are assets that need to be liquidated.
Chapter 7 Bankruptcy
If one does qualify for a Chapter 7 bankruptcy, all of the individual’s unsecured debts, such as credit cards and uncollateralized loans, may be extinguished or discharged. However, certain non-exempt assets may be liquidated, or turned into cash, and divided among your creditors, and then any of the debtor’s remaining debts are discharged. But, in many situations, debtors have no assets that are liquidated and therefore, all of the debtors debts are discharged. Certain assets though are exempt from liquidation based on Florida law. For example, a debtor’s homesteaded property is usually exempt from creditors. Additionally, money invested in 401Ks, retirement accounts, health savings accounts and certain college accounts for children are exempt. Certain debts, however, cannot be discharged such as alimony, child support and most tax debts. Student loans are usually non-dischargeable.
Furthermore, an individual has the option of reaffirming secured debts, such as mortgages on property and car loans, if the individual desires to keep the property. After a debtor is discharged from Bankruptcy, the individual is relieved from all unsecured debts and may go forward with his or her life with a clean financial slate. Moreover, it is illegal for employers to discriminate against people who have filed bankruptcy and it is becoming easier to repair one’s credit after a Chapter 7 bankruptcy. Therefore, the negative consequences of a Chapter 7 bankruptcy are becoming less and less daunting. The benefits of a Chapter 7 Bankruptcy may work for you and your family. Learn More Here
Chapter 13 Bankruptcy
If one does not qualify for a Chapter 7 Bankruptcy, a Chapter 13 bankruptcy is available. There are many benefits to a Chapter 13 bankruptcy that a Chapter 7 bankruptcy cannot offer. The biggest advantage of a Chapter 13 Bankruptcy is that the debt on a second Mortgage can be entirely eliminated. A second mortgage may be eliminated if the residence is worth less than the amount of the first mortgage.
After a petition for a Chapter 13 bankruptcy has been filed, a debtor has 15 days to submit a repayment plan with a trustee. A trustee has the option to agree to the plan or reject the plan. Depending on the debtor’s income and size of the debt, plans may last between 36 and 60 months. There is a priority when it comes to claims: priority, secured and unsecured. Most unsecured creditors end up getting close to 10% of their unsecured debt by the end of the plan. Another benefit of a Chapter 13 bankruptcy is that it does not affect a debtor’s credit as much as a Chapter 7 bankruptcy. Learn More Here