Top Orlando Bankruptcy Lawyer | Experienced Bankruptcy Attorneys
Have Questions about Bankruptcy? Talk to Our Orlando Bankruptcy Attorney
If history is any indicator, neither billionaires nor the working class are immune from financial distress. Consumers will usually look at filing bankruptcy as a means of ending constant harassment by creditors. Yet bankruptcy is a path that one should embark on only after careful examination of all other alternatives. While it is designed to provide relief from ballooning debts, some of its consequences may linger for years.
As an Orlando bankruptcy attorney with a stellar reputation, Badgley Law Group will advise you on your options. Although an affordable bankruptcy lawyer, we’ll first explore remedies that do not require bankruptcy filing. One alternative would be to open direct negotiations with your creditors. We’ll request for the modification of loan terms including reduced installments and an extension of the repayment period. Debt consolidation could also help as would the credit counseling required before the bankruptcy filing.
Bankruptcy is certainly not the only means of being protected from credit collections. However, in instances where bankruptcy is the best path, it is crucial that you move with speed. Some legal rights will be in jeopardy the longer you wait. An example is asset repossession or home foreclosure. A bankruptcy filing can prevent this from happening but only before the sale has been completed. Once the asset is sold, the debtor has lost their legal interest in it and cannot reverse the process. As an affordable bankruptcy attorney in Orlando, we will be there to support you every step of the way.
Hiring an affordable bankruptcy lawyer early could make the difference between losing and keeping your most prized assets. Badgley Law Group has assisted thousands of clients in filing bankruptcy in the bankruptcy court in Orlando. We have won several major victories and have distinguished ourselves in our singular pursuit of our client’s interests. We have helped families break the shackles of debt, cut monthly debt repayments by hundreds of dollars, rescue their homes, keep their cars and start a new life on a confident footing.
Despite our success, we still recognize that each bankruptcy case is unique and requires careful assessment before choosing an appropriate course of action.
Types of Bankruptcies We Handle in Orlando
Bankruptcy filings in bankruptcy court in Orlando may fall in one of the several categories. Each category is named after the chapter of the bankruptcy code that describes it. Overall, the bankruptcy chapter you file under mainly depends on your income, your debts, your assets, type of debt (secured vs. unsecured) and your overall goal of filing bankruptcy. Most debtors will file for either Chapter 7, 11 or 13. Individuals mostly utilize Chapters 7 and 13 while Chapter 11 is mostly associated with businesses.
Chapter 7 Bankruptcy Lawyer Orlando
Chapter 7 bankruptcy is a process of liquidating a debtor’s nonexempt assets in order to pay off creditors. It is usually the choice of persons without a regular income, little to no assets and who have been unable to pay their consumer debt. The typical Chapter 7 debtor has large unsecured debt (such as credit card debt or medical bills) and hardly any assets. One must pass a Means Test (see description further down this page) to be eligible for chapter 7 bankruptcy.
Most of the person’s debts are discharged while a trustee is appointed to manage the liquidation. Exempt assets include home equity, vehicle equity, household goods, life insurance not payable to the deceased’s estate, workers compensation benefits, 401(k) plans and IRAs. It’s perhaps unsurprising that the majority of Chapter 7 bankruptcies are no-asset cases meaning there is nothing for the trustee to sell in order to repay creditors.
When filing with their district bankruptcy clerk, the debtor submits an official petition, financial history, schedules of liabilities and assets, schedules of income and expenditure, schedules of unexpired leases and contracts, and creditor mailing addresses. The schedules must contain accurate and complete information. A debtor risks being charged with perjury if some information is false or has been deliberately excluded. Both dischargeable and nondischargeable debts should be included.
Filing automatically prohibits creditors from collection actions including lawsuits, written communication, and phone calls. The trustee appointed by the court notifies all creditors on the bankruptcy filing. A 341 Meeting between the debtor, creditor, and trustee is arranged (the meeting is discussed in more detail further down this page). If accepted by the judge, debtors will receive their discharge (copied to their creditors) about 4 months after filing.
Chapter 13 | Orlando Bankruptcy Attorney
A Chapter 13 bankruptcy is a mechanism for debt reorganization and repayment. It involves the development of a 3 to 5-year court-enforced debt repayment plan. The debtor commits to pay off part or all of their debt using their future income. A person will not qualify for this type of bankruptcy if their debt is too large or income too low.
It is the best alternative for persons who want to safeguard nonexempt assets that would otherwise be lost in a Chapter 7 bankrptcy. The debtor is probably running behind on their business or mortgage repayments but has the requisite income to eventually catch up under the right conditions. The filing halts late charges and interest on the unsecured debt. It also suspends levying of late charges on car loans, mortgages and other forms of secured debt.
Chapter 13 filing begins in much the same way as Chapter 7 bankruptcy. The debtor files a petition, schedules and a statement of monthly income. However, instead of a Means Test, the person provides a calculation of disposable income and a repayment plan. The plan details what, when and how creditors will be repaid.
This is followed by a 341 Meeting with creditors. If the plan is accepted by the judge, court-appointed trustees will be in charge of the distribution of payments to creditors as means of ensuring the plan is being honored. Creditors who intend to participate in the repayment distributions should file their claim within 90 days after the 341 meeting. If the court rejects the plan, the debtor may opt to either submit a modified plan or convert the case into a Chapter 7 liquidation.
Creditors are obliged to accept the repayment plan. The total amount the creditors receive under a Chapter 13 filing must at least equal to what they would have received under a Chapter 7 filing. Once the plan is in force, the debtor is not allowed to take on new debt without the trustees’ approval.
Chapter 11 | Orlando Bankruptcy
Chapter 11 bankruptcy is the most complex and expensive type of bankruptcy. It is often used as a last resort where no other avenue would be suitable. It is usually filed by businesses as means of reorganization either through debt restructuring, product pricing adjustment or the sale of non-core assets to pay off debt. In extremely rare instances, Chapter 11 bankruptcy may be filed by individuals who have very large debts that disqualify them from filing Chapter 13 bankruptcy.
The debtor submits a reorganization plan to the court. The plan may include renegotiating debts and selling off non-core divisions. If the debtor fails to submit a plan, the judge allows the creditors to do so instead. Once the judge agrees to the plan, the debtor is prohibited from making certain major decisions without the court’s approval. These include asset sales, rental agreement initiation or termination, and expansion of business operations.
Some of America’s best-known corporations have previously filed for Chapter 11 bankruptcy: Delta Airlines, United Airlines, Chrysler, General Motors, Kodak and Macy’s. Usually, the company will continue running its operations largely as usual. However, in cases involving dishonesty, gross incompetence or fraud, a court-appointed trustee will be tasked with managing the business during the proceedings.
Businesses will emerge from bankruptcy a few days to two years after filing.
How Bankruptcy Law Works
Knowing that the process can be abused, bankruptcy courts are keen on ensuring all filings are done in good faith. Certain actions a few days or weeks before filing (such as racking up credit card debt or the concealment of assets) will be viewed unfavorably by the judge and such debts may be excluded from the discharge.
Bankruptcy fraud is actually a criminal act and could even result in imprisonment. By engaging an affordable Florida bankruptcy lawyer early in the process, you can avoid seemingly innocent pre-filing actions that may be interpreted as dishonest by the court.
For any consumer bankruptcy within 180 days before filing debtors must sign up for credit counseling and submit a certificate of completion. Only certificates from organizations authorized by the U.S. Trustee Program to provide credit counseling will be accepted.
Pre-filing counseling will usually include an assessment of your finances, a discussion on bankruptcy alternatives and the preparation of a personal budget. The counseling usually lasts for between 60 and 90 minutes. It can be conducted in person, online or over the phone.
Everyone who files for Chapter 7 bankruptcy will be required to take a ‘Means Test’. The goal of the test is to ensure persons with considerable income are not allowed to file for Chapter 7 bankruptcy. It’s a means of protecting creditors from individuals who would want to get off easy yet have the means to pay at least part of what they owe.
If a debtor’s average monthly income over the preceding six months is below Florida’s median income for a similarly sized household, they automatically qualify to file for Chapter 7 bankrptcy. No further evaluation is required. Others who may be exempt from the means test include disabled veterans who incurred their debt while on active duty are exempt from the means test as well; debtors whose debts are mainly non-consumer (business) debts and a military reservist or member of the National Guard called to active duty prior to filing.
If the debtor’s income is above the state median, the testing becomes more complex. It requires a comparison of their basic monthly expenses (such as food, other household necessities, transportation and housing) to their average monthly income to determine the disposable income.
Income would not only cover the debtor’s salary (if employed) but any other sources including rental income, business income, dividends, interest earnings, pensions, unemployment income and any payment by someone else for their household expenses. If their disposable income is substantial relative to their debt repayments thus allowing repayment of at least a portion of the debts, they can only qualify for Chapter 13 bankruptcy.
Contrary to widespread belief, simply having a high income does not mean an individual will be automatically barred from Chapter 7 bankruptcy. The size of their financial obligations matters too.
The 341 Meeting
The 341 Meeting follows shortly after the bankruptcy filing. It is the initial meeting of creditors and is named after Section 341, the bankruptcy law section that describes when and how this meeting should be conducted.
Creditors rarely attend and it is often just the debtor and the trustee. Regardless of their absence, the trustee proceeds to interrogate the debtor under oath about their liabilities and assets. The 341 Meeting is very brief and hardly lasts more than 10 minutes. It is usually the only court appearance that a debtor will make during the entire process.
Creditors and the trustee have 60 days after the 341 Meeting during which they can file an adversary proceeding disputing the dischargeability of a specific debtor question the debtor’s right to discharge. Adversary proceedings are rare and will usually happen when the debtor is suspected of fraud or bad faith.
The overarching goal of bankruptcy is to give individuals and businesses a dignified fresh start. This is why the law classifies some assets as exempt from liquidation. The debtor can focus on rebuilding their finances without struggling with the basics. Exemptions vary by state and Florida’s are often considered one of the more generous.
A person must have lived in Florida for at least 2 years to use the state’s bankruptcy exemptions. Otherwise, the debtor would be restricted to either federal exemptions or the exemptions of the state they lived in the 6 months preceding the 2 year window.
Debtors list their exempt assets in the schedule accompanying the bankruptcy petition. The exemptions are considered final if no objections are raised 30 days after the 341 Meeting. Exempt assets are subsequently separated from the bankruptcy estate and cannot be sold by the trustee or attached by creditors.
An asset’s value refers to its present sale value as opposed to its replacement value or purchase price. In instances where the debtor co-owns an asset, bankruptcy proceedings will only calculate the debtor’s portion in the item’s equity.
FAQs about Bankruptcy Case | Orlando Bankruptcy Lawyer
Speak With an Experienced Orlando Bankruptcy Attorney For Free
Nothing legally prevents you from representing yourself in a bankruptcy proceeding. However, bankruptcy can be a complex process with numerous points to consider. A few wrong moves and you could emerge from bankruptcy in a much worse state than you had anticipated. There is no guarantee that the court will discharge your debts once you file.
It is therefore important to consult with an affordable bankruptcy lawyer to determine if the filing is a good idea, what chapter to file under, how to leverage exemption provisions and knowing what bankruptcy will protect you from. While you can always assess your own circumstances, it always helps to have a trained and objective eye take a look at your assets, liabilities, income, and expenses. Get in touch with an experienced Orlando bankruptcy attorney at Badgley Law Group for a free evaluation of your case.
Remember, creditors do not have a blank check in their quest to collect their debts from you. State law (Florida Consumer Collection Practices Act) and federal law (Fair Debt Collection Practices Act) provide clear guidelines on what creditors can and cannot do even before you file bankruptcy. Actions that fail to adhere to these acts are illegal and you should approach Badgley Law Group for assistance.