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Bankruptcy in Miami FAQs

Chapter 7 bankruptcy

Chapter 7 bankruptcy, also known as “liquidation bankruptcy,” allows debtors to discharge certain debts, providing a fresh financial start.
In Miami, as in the rest of the U.S., Chapter 7 involves the liquidation of non-exempt assets by a trustee to pay off creditors. After this, most of the debtor’s remaining debts are discharged.
To qualify for Chapter 7 bankruptcy in Miami, you must pass the means test, which compares your income to the median income in Florida. If your income is below the median, you qualify.
The trustee’s role is to manage the bankruptcy process. This includes reviewing your bankruptcy papers, selling non-exempt assets to pay back creditors, and conducting the meeting of creditors.
In Chapter 7 bankruptcy, some property is exempt from liquidation. Florida has its own set of exemptions that you may use, which include homestead exemption, personal property, and more.
Unsecured debts like credit card debt, medical bills, and personal loans are typically discharged in Chapter 7. However, child support, alimony, certain tax debts, and student loans are usually not discharged.
A Chapter 7 bankruptcy can stay on your credit report for up to 10 years from the date of filing.

Yes, but there are time limits. You must wait eight years from the date of your previous Chapter 7 bankruptcy filing.

Yes, but with limitations. While the bankruptcy is ongoing, the trustee controls the debtor’s assets, which may include the business. It’s crucial to consult with a bankruptcy attorney for advice tailored to your situation.

Chapter 13 bankruptcy

Chapter 13 bankruptcy, also known as a “wage earner’s plan,” allows individuals with regular income to develop a plan to repay all or part of their debts over three to five years.
In Miami, as in the rest of the U.S., Chapter 13 involves the reorganization of debts, allowing the debtor to use their income to make payments towards their debt over a certain period, while keeping their property.
To qualify for Chapter 13 bankruptcy in Miami, you must have a regular income and your unsecured and secured debts must be below certain limits.
The trustee’s role in a Chapter 13 case is to review the debtor’s proposed repayment plan, make recommendations to the court, and distribute payments to creditors as per the approved plan.
Yes, in Chapter 13 bankruptcy, you can keep all of your property, but you must pay unsecured creditors an amount equal to the value of your nonexempt assets as part of your repayment plan.
Chapter 13 bankruptcy discharges most debts. However, certain debts like child support, alimony, certain tax debts, and student loans are generally not discharged.
A Chapter 13 bankruptcy can stay on your credit report for up to seven years from the date of filing.
Yes, but there are time limits. You must wait two years from the date of your previous Chapter 13 discharge to file another Chapter 13 case.
Yes, you can continue to operate your business while in Chapter 13 bankruptcy. However, the bankruptcy trustee will have a significant role in overseeing your business finances.

Credit Card Debt in Miami

If you can’t pay your credit card debt, your credit card company may send your account to a debt collection agency. Continued non-payment can lead to a lawsuit.
Yes, a credit card company or a debt collector can sue you if you default on your credit card payments. If they win the lawsuit, they may be able to garnish your wages or put a lien on your property.
Filing for bankruptcy can help discharge credit card debt. In Chapter 7, most of your unsecured debts, including credit card debts, can be discharged. In Chapter 13, you repay a portion of your debts, including credit card debts, through a repayment plan.
In Florida, the statute of limitations for credit card debt is typically five years. This means a creditor has five years from the date of your last payment to sue you for the debt.
Yes, you can negotiate with your credit card company for a lower interest rate, a reduced payment, or even a reduction in the total amount you owe.
Debt consolidation is a strategy that involves combining all your credit card debts into one loan with a lower interest rate. This can make your debts easier to manage and reduce your overall interest payments.
Yes, high credit card balances can lower your credit score. Late or missed payments are also reported to the credit bureaus and can significantly impact your credit score.
When someone dies, their estate is responsible for paying off any credit card debt. If the estate doesn’t have enough assets to cover the debt, it usually goes unpaid. Credit card debt does not pass on to family members unless they are co-signers on the account.
Yes, credit card debt is typically dischargeable in a Chapter 7 bankruptcy.
Yes, credit card debt is included in the repayment plan in a Chapter 13 bankruptcy. The amount you’ll have to repay depends on your income, expenses, and types of debt.

Medical Bills in Miami

Yes, medical bills are considered unsecured debt and can be discharged in both Chapter 7 and Chapter 13 bankruptcy.
If you can’t pay your medical bills, the healthcare provider may send your account to a collection agency. Continued non-payment can lead to a lawsuit.
Filing for bankruptcy can help discharge medical debt. In Chapter 7, most of your unsecured debts, including medical bills, can be discharged. In Chapter 13, you repay a portion of your debts, including medical bills, through a repayment plan.
Yes, a hospital or a debt collector can sue you if you default on your medical bill payments. If they win the lawsuit, they may be able to garnish your wages or put a lien on your property.
In Florida, the statute of limitations for medical debt is typically five years. This means a creditor has five years from the date of your last payment to sue you for the debt.
Yes, you can often negotiate with your healthcare provider for a lower bill. Some hospitals and medical providers also offer payment plans.
Yes, unpaid medical bills can be sent to collections and appear on your credit report, which can lower your credit score.
When someone dies, their estate is responsible for paying off any medical debt. If the estate doesn’t have enough assets to cover the debt, it usually goes unpaid. Medical debt does not pass on to family members unless they are co-signers on the account.
Yes, credit card debt is typically dischargeable in a Chapter 7 bankruptcy.
Yes, credit card debt is included in the repayment plan in a Chapter 13 bankruptcy. The amount you’ll have to repay depends on your income, expenses, and types of debt.

Foreclosure in Miami

Yes, filing for bankruptcy can temporarily halt the foreclosure process due to an “automatic stay” that goes into effect when you file for bankruptcy.

Chapter 7 can temporarily stop foreclosure, but unless you can get current on your mortgage, the foreclosure may eventually continue. Chapter 13 allows you to repay mortgage arrears over time and potentially keep your home.
Yes, but it may take some time and effort to rebuild your credit. The waiting period can vary depending on the type of bankruptcy and the type of loan you seek.
Foreclosure in Miami follows the judicial process, meaning the lender must sue the borrower in court. The process begins when the borrower defaults on their mortgage payments.
A deficiency judgment is a lawsuit that the lender may file against the borrower if the sale of a foreclosed property doesn’t cover the outstanding mortgage balance.
Yes, filing for bankruptcy can potentially discharge a deficiency judgment. This depends on the type of bankruptcy and the specifics of your situation.

The timeline can vary, but typically, foreclosure starts after you’ve missed several mortgage payments and can take several months to over a year to complete.

Yes, options to avoid foreclosure include loan modification, refinancing, selling your home, or filing for bankruptcy.

After foreclosure, the lender can sell the home at a foreclosure auction. If the home doesn’t sell at auction, the lender becomes the owner and can sell the property.

Additional Bankruptcy in Miami FAQs

The means test determines if your income is low enough for you to file for Chapter 7 bankruptcy. It compares your average monthly income for the past six months to the median income in Florida.

A bankruptcy attorney guides you through the bankruptcy process, helps you understand your options, prepares and files your bankruptcy paperwork, and represents you at bankruptcy meetings and court hearings.

Filing for bankruptcy will lower your credit score initially. However, over time, as you discharge your debts and start fresh, you can rebuild your credit.
Yes, you can file for bankruptcy without a lawyer, but it’s not recommended due to the complexity of bankruptcy laws and the potential for mistakes.
An automatic stay is a legal injunction that stops most collection efforts, including calls, letters, and lawsuits, immediately after you file for bankruptcy.
A bankruptcy discharge releases the debtor from personal liability for certain specified types of debts, meaning the debtor is no longer legally required to pay those debts.
A bankruptcy trustee is an individual appointed by the court to administer your bankruptcy case, review your paperwork, sell your nonexempt property (in Chapter 7), or oversee your repayment plan (in Chapter 13).
Exempt property is property that bankruptcy law allows you to keep when you file for bankruptcy. Florida has its own set of bankruptcy exemptions
Yes, you can file for bankruptcy if you’re unemployed. In fact, unemployment is a common reason people file for bankruptcy.

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We work in the field of consumer bankruptcy in Florida. For the past 31 years, we have been filing Chapter 7 and Chapter 13 for individuals. We strive to be as efficient as possible whether a Chapter 7 or Chapter 13 is filed.

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