Miami Florida Bankruptcy Blog

Posts Tagged ‘Chapter 13 Bankruptcy’

Florida residents have three  main options when it comes to filing for bankruptcy: Chapter 7 Bankruptcy, Chapter 13  Bankruptcy and Chapter 12 Bankruptcy. Chapter 7 bankruptcy is also referred to as “straight” or “clean slate” bankruptcy. This option wipes out all applicable debt immediately.

Chapter 13 bankruptcy allows the individual to create a payment plan to wipe out debt over several years of payment.  With the change in Bankruptcy Laws in 2005 many people who do not qualify for a Chapter 7 Bankruptcy utilize a Chapter 13 Bankruptcy to regain control of their financial situation and get back on the road to prosperity.

Chapter 12 bankruptcy is a special process only available for family farmers and fishermen and follows slightly different procedures than the more common Chapter 7 and Chapter 13 proceedings.

Additionally, an individual may in some rare circumstances file for a Personal Chapter 11 Bankruptcy. Chapter 11 Bankruptcy is typically reserved for businesses. Depending upon your situation, a Personal Chapter 11 Bankruptcy may be the best option.

No matter which option you choose in Bankruptcy, it is important to be well informed and find a law firm you are comfortable working with. A Bankruptcy is a very personal situation that requires a close relationship with the law firm that you choose to hire. It is important that you feel that you are being treated as an individual and not as a number. This is important because, no matter which option you choose, if you are not treated with dignity the process will not be pleasant and no matter what the outcome is you will not be satisfied.

Matthew E. Mazur, Jr. Esq., is the managing shareholder of Matthew Mazur, P.A., a Coral Gables, Florida based law firm that represents clients in Bankrutpcy matters. For more information please visit www.coralgablesbankruptcyattorney.com.

If Successful, a Chapter 13 Bankruptcy will require your creditors to take less money monthly over a three to five year period. A Chapter 13 Bankruptcy  carries the full force of the United States Government behind it. Banks, credit card companies, debt collectors and the like, clearly understand that your Chapter 13 Bankruptcy provides you with the government’s protection and the harassing phone calls and other harassing tactics they have been using to try and collect their debt will stop as soonas they are aware that you have filed for Chapter 13 Bankruptcy protection. If they don’t stop they may very well have to answer to the court as to why they didn’t.

When your Chapter 13 Bankruptcy is filed it will put a stop to:

• foreclosure actions;  
• wage garnishments  
• repossession of you car;  
• late charges;  
• interest and penalties on credit card accounts, taxes, and other loans;  
• harassment for back child support.  

Simply stated, a Chapter 13 Bankruptcy has the power to change your life. You can take almost every one of your current bills and consolidate them into one low monthly payment and in most circumstances your creditors are virtually powerless to do anything about it. If your Chapter 13 plan is approved they  must accept your court ordered payment plan whether they like it or not. 

The filing of the Chapter 13 petition must be accompanied by a proposed payment plan extending up to five years. The proposed payment plan must provide for the payment of all priority claims, such as taxes, in full. All tax returns for the four years prior to filing must be filed. 

The court will apply living standards set by IRS regulations to determine what is reasonable for you to pay for living expenses, including housing and food, to find out how much you have available to pay your debts. 

The bankruptcy trustee appointed by the Bankruptcy Court must review the proposed plan for accuracy and feasibility. The proposed plan is distributed to creditors, who have the right to object to the plan if it’s unreasonable. If the plan is approved, you can keep all your assets during the period of the plan. You make monthly payments to the bankruptcy trustee, who distributes the funds to the creditors according to the plan. If the plan is completed as approved, your unpaid debts are discharged. 

Matthew E. Mazur, Jr. Esq., is the managing shareholder of Matthew Mazur, P.A., a Coral Gables, Florida based law firm that represents clients in Bankrutpcy matters. For more information please visit www.coralgablesbankruptcyattorney.com.