When it comes to protecting equity in a home, Florida residents can get some valuable relief should they be forced into bankruptcy. Under Florida state law, a homestead exemption not only saves residents thousands in property taxes, but specifically protects the investment in a person’s property when someone files a bankruptcy in Florida. Experienced Florida bankruptcy attorneys understand that the homestead exemption is a significant help to many of their clients, and something that should be considered in the context of a bankruptcy decision.
In 2016, almost 1 million people in the U.S. filed for some form of bankruptcy, the most common being Chapter 7 protection, which differs from Chapter 13 in that a repayment plan does not need to be filed. Those who file for Chapter 7 will take a major hit on their credit, possibly dropping their credit score 200 points or more. There is no doubt that this is a major financial blow – as were the events leading up to the bankruptcy, in all likelihood – but the mistake many people make is in seeing their filing as an end; as something that can’t be recovered from.
Your financial well-being can take a huge hit if there is negative information on your credit report. It may disqualify you from being approved for a home mortgage or a car loan, or result in your interest rates soaring.
In some cases, it may even prevent you from getting the job you really want. As a result, you are likely going to want to have any negative information taken off of your credit report as soon as the limit for that particular debt is reached.
If you are considering filing bankruptcy, there are likely quite a few thoughts going through your mind. For example, what’s going to happen? Are you going to be able to keep your home? What will happen to your credit rating? Perhaps the most important one is, what is bankruptcy going to do to your car and home loans?
The Orlando Sentinel recently reported that until last month, the Metro Orlando area was No. 1 in the country for its rate of mortgage foreclosures. This could explain why so many people have been calling my law firm with questions about mortgage foreclosure and bankruptcy. The intersection of bankruptcy and foreclosure is a place of confusion for many homeowners who are looking for options and answers. This week, a couple came to my practice with lots of questions about their mortgage foreclosure, even though they had completed a Chapter 7 bankruptcy with another lawyer several years ago!