All individual debtors who file bankruptcy must participate in credit counseling within six months before filing for bankruptcy and complete a financial management instructional course after filing bankruptcy. These courses can be completed online from your home computer.
At the time of filing, a means test (analysis of your income and expenses) to determine if you qualify to file a Chapter 7 or if you must file Chapter 13. In applying the means test, the courts will look at your average income for the 6 months prior to filing and compare it to the median income for Florida. If the income is below the median, then you may choose Chapter 7. If your income exceeds the median, the remaining parts of the means test will be applied to determine if you can file Chapter 7 or if you must file Chapter 13.
To begin the bankruptcy process you must itemize your current income sources; major financial transactions for the last two years; monthly living expenses; debts (secured and unsecured); and property (all assets and possessions, not just real estate). You should also collect your tax returns for the last two years, deeds to any real estate you own, your car(s) titles, and the documents for any loans you may have.
Once you have gathered this information, we will help you determine which property is exempt from seizure. In Florida, exemptions include:
- Your house, mobile or modular home, or condominium (may not exceed half-acre in a municipality or 160 acres elsewhere). The exemption is limited to $160,375, unless you occupied this Florida homestead and previous Florida homesteads for a continuous 1,215 day period.
- Personal property such as prepaid accounts like hurricane savings, medical savings and college education trust deposits; motor vehicle up to $1,000; pre-need funeral contract deposits; any personal property up to $1,000 or $4,000 if no homestead claimed
- 100 percent of wages earned by the head of the household, up to $750 a week; federal government employees’ pension payments needed for support and received up to three months prior to bankruptcy
- Pensions, tax-exempt retirement accounts like 401(k)s, profit sharing/money purchase plans, SEP and SIMPLE IRAs, defined benefit plans, IRAs and Roth IRAs to $1,283,025, state/municipal pensions and ERISA qualified benefits
- Public benefits such as unemployment compensation, veterans benefits, Social Security, workers compensation and crime victims’ compensation, unless debts for treatment of crime-related injury are part of filing
- Alimony/child support
- Insurance payments such as death benefits, annuities (excluding lottery winnings), life insurance cash surrender value, disability/illness benefits and fraternal society benefits.
To actually file, we will complete a petition and several schedules which describe your current financial status and recent financial transactions (typically within the last two years). If your creditors or the judge feel or find out that you have not been entirely forthcoming in your bankruptcy filing, it could jeopardize the outcome of your petition.
If you are filing a Chapter 13 bankruptcy, a proposed repayment plan must also be submitted. The plan sets out the amount of money you have available, after reasonable monthly expenses have been paid, to put toward your outstanding bill and how this money be apportioned to your creditors. Priority claims (such as taxes and back child support) must be paid in full; unsecured debts (like credit card debt and medical bills) are usually paid in part. Depending upon the judgments of those involved with your case, unsecured debts can be paid off for as little as 10 cents on the dollar.
Once we have filed your bankruptcy petition with the bankruptcy court, an automatic stay goes into effect which prevents your creditors from making direct contact with you or staking a claim on any of your property from the day of filing forward. The stay will also stop the proceedings in any pending foreclosure action filed against you.