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Who Qualifies for Chapter 7 Bankruptcy?

The qualifying conditions for Chapter 7 bankruptcy are not impossible to meet, but you must be able to show you are facing the financial hardships they cover before being granted this relief.

At The Law Office of Michael A. Kaufman, P.A., we have an experienced bankruptcy attorney in Loxahatchee, FL, who will provide here the information you need to see if you qualify for Chapter 7. This type of bankruptcy wipes out most unsecured debts and will give you a fresh start, but there are eligibility requirements that must be met.

When you’ve hired a bankruptcy attorney, the first thing he or she will likely address is previous bankruptcies. If you received a Chapter 7 discharge in the past, you must wait at least eight years from the earlier filing date before re-applying again. If you received a Chapter 13 discharge, you must wait six years. You must also complete a credit counseling course six months before you file for Chapter 7.

Also, anyone seeking the assistance of a bankruptcy attorney to file for Chapter 7 protection must pass a means test by showing that you have little or no disposable income. This test takes your average monthly income for the six months before your bankruptcy and compares it to the median income from a similar household in your state. If your income is below the median, you automatically qualify.

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Should You File Chapter 11 Bankruptcy? The Pros and Cons

Financial hardship is a reality of business life that hits some companies with a sledgehammer blow. It’s not anything to be ashamed of, and there’s no need to suffer needlessly under the crushing weight of insurmountable debt when there is a remedy available. The solution to getting your company’s finances back in order is available through Chapter 11 bankruptcy.

At The Law Office of Michael A. Kaufman, P.A., our bankruptcy attorney in West Palm Beach, FL, knows all about the qualification and filing process and is going to discuss the pros and cons here.

The pros are many, and foremost among them is that your business can still operate while paying its debts under a reorganization plan. Other positives include:

  • Creditors will stop pursuing your business.
  • You can renegotiate specific debts, such as leases.
  • Your business gets a chance at a fresh start.

Of course, with positives there are negatives too, and any bankruptcy attorney worth his or her salt will tell you this process can be lengthy and expensive. That is why small businesses sometimes opt for Chapter 7 or Chapter 13 filings instead. If you decide to file a Chapter 11 bankruptcy, keep in mind it allows your business to create a well-structured debt repayment plan.

Take the time to seek out a bankruptcy attorney who will find the best options for your company.

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Filing for Chapter 7 Bankruptcy: The Pros and Cons

Many people have experienced financial hardship and have had to consider declaring bankruptcy. If you have found yourself in this situation, then you need to know the pros and cons of a Chapter 7 bankruptcy versus Chapter 13. A Chapter 7 bankruptcy is known as a “liquidation bankruptcy,” and while it is always best to consult with a Chapter 7 attorney in West Palm Beach, FL, to get the full picture of your individual situation, here are the larger considerations.

Pros

It’s Less Expansive Than Chapter 13 – The costs of filing Chapter 7 are generally much less compared to filing under Chapter 13.

Speed of a Chapter 7 Discharge – A no-asset Chapter 7 case is usually completed in under six months after filing the Chapter 7 petition. This means most of your unsecured debts may be eliminated in under 180 days.

You Can Potentially Keep Property – Many people who file a Chapter 7 get to keep all their property, but a Chapter 7 attorney will explain that there are some who do not.

It Stops Debt Collection Lawsuits – Filing Chapter 7 stops the lawsuits of creditors who may be suing you. If the debt is eligible for a discharge, the lawsuit cannot resume, and you get rid of the debt.

Cons

Income Requirements – Chapter 7 has specific income requirements to qualify for a bankruptcy discharge under this chapter of bankruptcy. There is a means test, and if your income exceeds the median income for your state, you may not qualify for discharge in Chapter 7.

Non-dischargeable debt – A Chapter 7 attorney can explain that some debts are not dischargeable in bankruptcy, including most student loans and taxes. Child support, marital alimony, some judgments, and most government debts are also not dischargeable in bankruptcy.

Negative Credit Impact – Your credit score may be negatively impacted, and the Chapter 7 remains on the credit report for ten years.

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Questions You Should Ask Your Bankruptcy Attorney

If you’re filing for bankruptcy, then finding the right bankruptcy attorney in Royal Palm Beach, FL, can make a big difference to your case. Many attorneys are willing to provide a free initial consultation to help you determine whether their services are a good fit for your needs. Make sure you take advantage of these meetings by asking the right questions. Here are some critical questions to ask your bankruptcy attorney before you hire him or her.

Do I Pass The Means Test To Qualify For Chapter 7?
The attorney can review your income and your pay stubs at the initial consultation to determine whether you qualify for Chapter 7 bankruptcy. It is important for your bankruptcy attorney to let you know where you will be once you are ready to file, and where you stand in the eyes of the Court.

If Chapter 13 is  Recommended, Why?
Your bankruptcy attorney can explain the five reasons for filing a Chapter 13, and if  Chapter 13 is recommended, then you should ask why. An attorney can collect $2,000.00 more in fees from  Chapter 13 than in a Chapter 7 case, and some firms are known for pushing Chapter 13 cases to generate higher fees.

How Many 707b Objections Have You Handled and Who Prevailed?

Every bankruptcy attorney will eventually encounter an objection to a Chapter 7 case when representing clients in bankruptcy. A 707b objection is typically an objection by the United States Trustee, alleging that the Chapter 7 filer should be in Chapter 13 due to making too much money for Chapter 7.

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Pros and Cons of Filing for Chapter 13 Bankruptcy

Deciding whether you should declare bankruptcy is always very difficult. In addition to deciding whether or not you should file, you’ll also need to consider which type of bankruptcy is appropriate. This is typically either Chapter 7, Chapter 11, or Chapter 13 bankruptcy. Here are some of the top advantages and disadvantages to consider as you decide if a Chapter 13 bankruptcy and a Chapter 13 attorney in West Palm Beach, FL is best for you.

Disadvantages of Chapter 13

There are a number of disadvantages to filing for Chapter 13 bankruptcy. In general, here are the top ones to keep in mind:

Time – It can take up to five years for you to repay your debts under a Chapter 13 plan.

Living Lean – Debts need to come out of “disposable” income, which is what’s left over after the bare necessities are paid. Therefore, all extra earnings are used up for the whole repayment plan.

No Credit Cards – A Chapter 13 attorney will tell you that you’ll lose all your credit cards.

A Long Road – A Chapter 13 bankruptcy can remain on your credit report for up to 10 years.

Student Loans Don’t Count – Bankruptcy won’t address your student loan debt.

Advantages of Chapter 13

Flexibility – Chapter 13 trustees, can be flexible on the terms of your payments. You may be able to stretch out your debt payments, reduce the amounts, or give up an item you are making payments on.

Keep Your Things – A Chapter 13 attorney will also tell you that while you’re making payments under a Chapter 13 plan, you get to keep the property on which you’re making payments.

Done Means Done – Once you fully complete a bankruptcy repayment plan under Chapter 13, individual creditors cannot obligate you to pay them in full.

Bankruptcy can negatively affect your future credit, your reputation, and your self-image. However, it is true that it can also considerably improve your life’s short-term quality if you find yourself financially in over your head.

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Signs You Should Call a Bankruptcy Attorney

Sometimes, life events or the pressures of financial hardship may lead a person to have to declare bankruptcy. The process is complex and in order to make sure you are filing for the right category of bankruptcy, it may be best to retain a bankruptcy attorney to help guide you through the steps. Some signs that you may need to consult with a bankruptcy attorney in West Palm Beach, FL may include:

  • Being Unable to Pay Your Monthly Bills
  • Relentless Calls From Creditors and Debt Collectors
  • If You Are Unsure of How to Address Accumulating Debt
  • Bounced Checks
  • No Cash Flow
  • If You Need Representation in Court

Filing Personal Bankruptcy

If you are filing personal bankruptcy, you may wish to obtain a Chapter 7 bankruptcy attorney if you cannot repay your debt over time. Often, a fresh financial start is given in return for some of your personal assets. If you are trying to repay your debt, but you just need more time, a Chapter 13 bankruptcy attorney can help restructure your debts and possibly negotiate a payment plan with your creditors.

Commercial Bankruptcy

If your business is struggling financially, you may wish to hire a Chapter 11 bankruptcy attorney. Your lawyer can help secure the time you need to reorganize your business and your debts to be paid later. But, if you feel that you will have to close your business, you may need a Chapter 7 bankruptcy attorney, who will help you hand over your business to the creditor in return for cleared debt.

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Welcome to Our Blog

Welcome to the blog of Kaufman Bankruptcy Law. If you’re searching for a bankruptcy attorney in West Palm Beach, FL, look no further. Our goal is to keep our clients informed by providing a resource where they can find advice before consulting a lawyer. We specialize in bankruptcy law, so if you’re currently undergoing financial troubles, please read on to find out how our firm can help you climb out of this seemingly endless pit.

Handling All Things Bankruptcy

At our law firm, we are licensed and experienced in the field of bankruptcy. Our attorney has handled both personal and corporate cases, from Chapter 7 to the consolidation of debts. We understand the difficulty of filing for bankruptcy, which is why we work closely with you throughout every step of the process. You can count on us for informative and compassionate counsel.

When you need advice from a bankruptcy attorney, our firm is here to help. We are dedicated to every client’s success, so you can expect us to go above and beyond to help you achieve your goals. Please continue following our blog for updates on Kaufman Bankruptcy Law, as well as informative advice from knowledgeable professionals.