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Boca Raton, FL 33431
Phone: (561) 629-5757
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DEBT RELIEF & BANKRUPTCY LAW

We are a debt relief law firm that helps people and businesses obtain debt relief with and without filing for bankruptcy.

People usually obtain debt relief by filing for bankruptcy protection under the bankruptcy code.  We represent people and businesses throughout the bankruptcy process.  Filing for bankruptcy protection provides immediate relief in the form of an automatic stay.  This helps stop foreclosures, garnishments, repossessions, lawsuits, judgments and collection calls.  Filing also helps reduce, if not eliminate debts, while allowing people to keep certain exempt assets

People can file for protection under several chapters – Chapter 7 “Fresh Start”, Chapter 13 “Wage Earner’s Plan” and Chapter 11 “Reorganization. Family farmers and fishermen are entitled to file under a special chapter.  Corporations and organizations can file for protection under Chapters 7 and 11.  Municipalities can also obtain debt relief.

Bankruptcy filings occur all the time.  On average, over 1.3 million people and businesses filed for bankruptcy each year (from 2003 - 2007). Morever there was a 68% increase in filings last year in the Southern District of Florida.

Many of theses filing are for understandable reasons, such as the loss of a job, a health or medical condition, death and divorce.

Whether bankruptcy is best for you depends on your situation, your desires and the circumstances of your case.  To find out whether bankruptcy or a bankruptcy alternative is right for you, contact a debt relief attorney today.

Debt Relief Without Filing for Bankruptcy

It is possible to reduce debt and get a better hold on your finances without filing for bankruptcy protection. Sometimes, debt relief can be realized by, among other things, negotiating settlements and making offers in compromise with creditors.

If you need or wish to do so, you should contact a debt relief and bankruptcy lawyer who can help you make an informed decision about your options and how best to proceed.

Bankruptcy Process

Filing for bankruptcy protection is another way of obtaining debt relief. The bankruptcy code provides several avenues (in various chapters) for debtors to obtain debt relief.

Within a reasonable time after filing for relief, the United States Trustee holds a meeting of the creditors. 11 U.S.C. §341(a). This meeting includes an oral examination of the debtor (typically lasting ten or fifteen minutes for individual debtors). 11 U.S.C. §341(d) & 11 U.S.C. §343.

A case involving an individual is usually disposed of in about six months (depending on, among other things, the court’s docket, etc.). Organizational and other cases are more complex and usually take more time.

If you need or desire debt relief, or creditors are attempting to seize your property to satisfy debts they assert you owe them, you should contact a debt relief and bankruptcy lawyer to protect your interests.

Automatic Stay

The automatic stay is one of the important benefits of filing for bankruptcy protection. Indeed, the mere filing of a petition for relief constitutes an immediate order for relief under the bankruptcy code. 11 U.S.C. §301. This order for relief automatically stays certain actions against a debtor, including commencement and continuation of certain law suits and proceedings, enforcement of judgments, repossession, foreclosure, eviction, collections and setoff of debts. 11 U.S.C. §362(a).

Before a creditor can properly begin or continue any of these stayed actions, a creditor must obtain relief from the stay by the court. 11U.S.C. §362(d). A creditor who willfully violates the automatic stay can be subjected to sanctions, including reasonable attorney’s fees, for actual injuries to the debtor. 11 U.S.C. §105 (contempt power); 11 U.S.C. §362(k) (“An individual injured by any willful violation of a stay provided by this section shall recover actual damages, including costs and attorneys' fees, and, in appropriate circumstances, punitive damages.”); 11 U.S.C. §342(g)(2) (providing that a monetary penalty cannot be imposed on a creditor who violates the automatic stay unless the creditor previously received effective notice).

If you need or desire debt relief, or creditors are attempting to seize your property to satisfy debts they assert you owe them, you shouldcontact a debt relief and bankruptcy lawyer to consider invoking the automatic stay and to protect your interests.

Exempt Assets

Certain assets cannot be taken to pay creditors under the bankruptcy code and/or state law. See also Fla. Const. Art. VII, Section 6.

Bankruptcy law generally allows debtors to “elect” (i.e. choose) whether to use certain federal asset exemptions or the asset exemptions provided by state or local law. 11 U.S.C. §522(b)(1). In order to elect these certain state or local law exemptions, however, a debtor must have been domiciled (the place the debtor has resided with the intent to remain indefinitely) in the place whose law the debtor seeks to use (i.e. “elect”) for at least 730 days before the filing of the petition for relief. 11 U.S.C. §522(b)(3)(a).

States, however, can eliminate this choice, generally leaving the debtor with only their state’s exemptions. 11 U.S.C. §522(b)(2). Florida has done so. Fla. Stat. §222.20, Fla. Stat. §222.201 (exceptions). Thus, Florida debtors are generally limited to Florida’s asset exemptions. 11 U.S.C. §522(b)(2) and (b)(3)(B)&(C).

Florida’s exemptions include: (1) homestead properties protected by the Florida Constitution and/or by Florida statute (including modular and mobile homes), (2) other property such as certain: wages (see also Fla. Stat. §222.15 & Fla. Stat. §222.16), life insurance proceeds, cash value of life insurance and annuities, disability income, pensions and other tax-exempt funds, qualified tuition programs, medical savings accounts, Coverdell education savings accounts, hurricane savings accounts, up to $1,000 in vehicle value, health aids, certain tax refunds or credits from the IRS, up to $1,000 in personal property and up to $4,000 in personal property (only if no homestead is claimed or received), and (3) the following federal exemptions that are allowed by Florida’s statutes concerning: social security, veterans, disability, illness, unemployment, alimony, support, maintenance, and benefits of certain other plans and contracts.  11 U.S.C. §522(d)(10) (federal exemptions allowed by Florida law). 

In addition to the forgoing state exemptions, the bankruptcy code allows debtors to exempt certain property that is held as joint tenants or as tenants by the entireties to the extent the property is exempt under “applicable nonbankruptcy law”.  11 U.S.C. §522(b)(3)(B)&(C) (emphasis added).  Unlike the exemptions discussed in the prior paragraph, these exemptions do not specifically require the debtor to reside in the state for 730 days.  Cauley, 374 B.R. 311, 315-316 (M.D. Fla. 2007) (pg. 4 in pdf file) (holding that (1) “the exemptions set forth in § 522(b)(3)(B) are in addition to those exemptions under state or local law authorized by § 522(b)(3)(A)”, and (2) § 522(b)(3)(B)’s reference to “‘applicable nonbankruptcy law’ in this instance is Florida law, the state in which the Orange Park Property is located.”) (emphasis added).

Under Florida law, where only one spouse owes a debt, property held as tenants by the entireties generally cannot be reached (i.e. taken and sold) by creditors to satisfy the debt.  Beal Bank, SSB v. Almand and Assocs., 780 So. 2d 45, 53 (2001) (pg. 14 in pdf file; tenants by the entireties defined and explained on pgs. 10-14).  Florida law also presumes that real estate and other property owned jointly by a husband and wife, such as joint bank accounts, are held as tenants by the entireties.  Beal Bank, SSB, 780 So. 2d at 58-60 (pgs. 25-32 in pdf file).  Accordingly, a debtor may be entitled to keep such property (including equity), without limitation, while, at the same time, discharging or relieving debt under the bankruptcy code, regardless of residency.

In short, if you need or desire debt relief, or creditors are attempting to seize your property to satisfy debts they assert you owe them, you should contact a debt relief and bankruptcy lawyer to protect your interests in exempt property, among other things.

Individual Debtors

Individuals cannot file for bankruptcy unless they have completed credit counseling from an approved agency “that outlined the opportunities for available credit counseling and assisted such individual in performing a related budget analysis.”  11 U.S.C. §109(h).  This requirement can be waived under certain circumstances for up to forty-five (45) days after filing for bankruptcy protection.  11 U.S.C. §109(h)(3).  Credit counseling, however, does not apply to those “unable to complete those requirements because of incapacity, disability, or active military duty in a military combat zone.”  11 U.S.C. §109(h)(4).

That said, individuals can file for relief under three chapters: Chapter 7, Chapter 13 and Chapter 11.

Chapter 7

Chapter 7 is a liquidation preceding also known as a “fresh start”.  Under this chapter, individuals seek a discharge of unsecured debt while keeping the exempt property (discussed above) the debtor wishes to retain, subject to paying mortgages, car loans, and other debts that are secured by the assets the debtor seeks to keep.(i.e. reaffirming the debt). 

As an alternative to reaffirming a debt, individuals can also redeem certain property for the property’s value. 11 U.S.C. §722 (certain property can be redeemed for “the amount of the allowed secured claim”); 11 U.S.C. §506(a) (limiting secured claims “to the extent of the value of such creditor’s interest in the estate’s interest in such property” and rendering the remainder “an unsecured claim to the extent that the value of such creditor’s interest … is less than the amount of such allowed claim”).  Redeeming property can be beneficial when, for example, the value of a car is less than the amount owed on the car.

In order to remain eligible for Chapter 7 (i.e. a non-abusive filing), individual debtors must satisfy one of two means tests.  Means testing information can be found on the Department of Justice’s U.S. Trustee Program website.

The initial means test compares the debtor’s current monthly income (which is based on one of two six month periods and generally includes both spouses incomes even where only one spouse has filed for bankruptcy protection) with the applicable state median income based on the size of the family.  11 U.S.C. §707(B)(6)&(7).  As of May 14, 2008, for bankruptcy petitions filed on or after March 17, 2008, the median incomes in Florida for one to four person families are: $40,036, $50,636, $56,923, and $66,876, respectively.

Where the debtor's currently monthly income is less than or equal to the applicable state median income, the presumption of abuse does not arise.  As a result, the debtor remains eligible for Chapter 7 (if not otherwise ineligible).

In the event the debtor's current monthly income exceeds the applicable state median income, another, more complicated test is applied.  11 U.S.C. §707(B)(2).  This second test allows some individuals who do not pass the initial test to remain eligible for Chapter 7 by satisfying the second test. 11 U.S.C. §707(B)(2).  Information relating to this second test can be found on the Department of Justice’s U.S. Trustee Program website.

If you need or desire debt relief, or creditors are attempting to seize your property to satisfy debts they assert you owe them, you shouldcontact a debt relief and bankruptcy lawyer to consider whether a “fresh start” is best for you as well as to protect your interests in exempt property, among other things.

Chapter 13

Chapter 13 is a reorganization plan also known as the “wage earner’s plan”.  Under this chapter, only individual wage earners who have less than $250,000 in unsecured debts and $750,000 in secured debts can seek to reorganize their debts into a three to five year payment plan (which can include overdue mortgage payments as of the bankruptcy filing as well as other obligations, thereby allowing the debtor the opportunity to keep their home and avoid foreclosure).  11 U.S.C. §109(e).

Chapter 13 payment plans are based upon the debtor’s income and allowable expenses under the bankruptcy code (i.e. disposable income).  As a result, plans vary from one debtor to the next.

If you need or desire debt relief, or creditors are attempting to seize your property to satisfy debts they assert you owe them, you should contact a debt relief and bankruptcy lawyer to protect your interests.

Chapter 11

Chapter 11 is a reorganization plan usually used by businesses and rarely used by individuals since the protections under Chapter 7 and Chapter 13 are typically better for individual debtors.  That said, individuals can file for Chapter 11 reorganization, particularly if they do not qualify for Chapter 7 or Chapter 13.  Under this chapter, a debtor seeks an order establishing a repayment plan of up to five years.  11 U.S.C. §109(e).

If you need or desire debt relief, or creditors are attempting to seize your property to satisfy debts they assert you owe them, you should contact a debt relief and bankruptcy lawyer to protect your interests in exempt property, among other things.

Corporate and Organizational Debtors

Corporate and organizational debtors generally file under Chapter 11 to reorganize their debts.  This allows the organization to continue operating for a period of time in order to prepare a workable repayment plan, which generally includes reductions in the organization’s debt.

In the event reorganization is not successful, the case may be converted to Chapter 7 to liquidate the organization’s assets.

If your organization needs or desires debt relief, or creditors are attempting to seize your organization’s property to satisfy debts they assert your organization owes them, you shouldcontact a debt relief and bankruptcy lawyer to protect your organization’s interests.

Family Farmers and Fishermen

Family farmers and fishermen are permitted to reorganize under Chapter 1211 U.S.C. §109(f); 11 U.S.C. §109(g) (excluding certain family farmers and fishermen).

If you are a family farmer or fisherman and need or desire debt relief, or creditors are attempting to seize your property to satisfy debts they assert you owe them, you shouldcontact a debt relief and bankruptcy lawyer to protect your interests.

Municipalities

Municipalities can obtain depbt relief under Chapter 9 of the bankruptcy code.  11 U.S.C. §109(e).

If your municipality needs or desires debt relief, or creditors are attempting to seize your municipalities property to satisfy debts they assert your municipality owes them, the municipality should contact a debt relief and bankruptcy lawyer to protect the municipality’s interests.