There are many circumstances that people, both young and old, are facing that has them considering declaring bankruptcy. This may not be as easy as one with no experience in this area of law may believe it to be.
There are many reasons to choose this avenue to prevent loss of your home and other assets you have worked for years to obtain. Here are the top five reasons that most bankruptcy filings are made.
- Medical Expenses
- Job Loss
- Credit misuse
- Unexpected expenses
These and other serious problems lead to people taking the unwanted step of filing for bankruptcy. Once you have decided on this course you will have to file many forms containing proof of exactly why you have to take this step, and this information will help the court determine if you will be allowed to declare bankruptcy. One of these steps involves the Median Family Income Test.
This test takes census bureau information that tracks the state of Florida’s median family income. Basically all family incomes in the state are compared and the mean or average figure is established as the median income. The person or persons filing for bankruptcy will most times have to have an income lower than the mean income of the state to qualify for a chapter 7 bankruptcy. There are expenses that may help you qualify for a Chapter 7 bankruptcy even if you are over the median income figure, but it won’t be easy.
That is why a Florida Attorney experienced in the states bankruptcy laws is essential to your successful completion of this process. They will know if these expenses are enough to help you pass the means test so all is not lost. Also your Attorney will still have the opportunity to have you file for Chapter 13 bankruptcy that will place you in a three to five year plan to pay off your debts. An attorney can also contact your creditors and draft a reorganization of your debts and make it possible for you to satisfy your creditors without declaring Chapter 7 or 13 bankruptcy.
The key to this process is much more than telling the court you have too much going out and not enough coming in. Chapter 7 filing will require selling assets to help pay off debt, but many important assets (home, vehicle, 401K and IRA Accounts) are exempt, so this does make declaring bankruptcy more attractive than you might think.
Lack of assets to sell may lead your creditors to consider a debt reorganization plan that will stop interest accrual and late fees so the situation may not be as desperate as your imagination may have led you to believe. The facts about debt reorganization and Bankruptcy are available to you at the Badgley Law Group office. They can explain all the facets of bankruptcy filing to you and create the best plan possible for you and your family to put this current position you are in firmly in the rear view mirror.