There are various aspects of bankruptcy that are handled by the U.S. court system, but the state of Florida also handles the laws pertaining to bankruptcies within the state. Each state may have different laws regarding certain aspects of a bankruptcy, and Florida is no different.

You should understand the way that Florida bankruptcy laws will affect your Chapter 7, 11, 12 or 13 filing, before you actually file. If you use a local bankruptcy attorney in your area of Florida, he or she will be familiar with the ways that state laws affect each filing.

Most bankruptcies are of the Chapter 7 type. In these cases, most of your debt will be waived, and any assets that are not exempt may be sold, in order to pay off your creditors. In most cases, though, you won’t lose your car or your home, unless you’re living well beyond your means. You can reaffirm debts that you wish to continue paying on, so that these assets will not be sold.

A Chapter 13 bankruptcy will allow you to reorganize your debts and repay them, under a five year plan. Chapter 11 is somewhat similar to a Chapter 13, in so far as it will let you reorganize debts without the limits imposed by a Chapter 13 filing. Chapter 12 applies to farmers and fishermen.

If you file for a bankruptcy in the state of Florida, you will not be allowed to waive certain types of debt. These include:

  • Alimony
  • Child Support
  • Most student loans
  • Your most recent back taxes
  • Penalties or fines that you owe to agencies of the government
  • Payments on luxury goods that you bought in the last 90 days before you filed
  • Cash advances larger than $825 that were made in the last 70 days before you  filed

Congress passed massive reforms to bankruptcy proceedings in 2005, and these affect every state, including Florida. They came about due to the implementation of the Bankruptcy Abuse Prevention and Consumer Protection Act. These reforms are designed to disallow consumers from filing bankruptcy when they are actually able to pay their debts, or are trying to get out of legitimate debts. Under this Act, you have to prove that you are actually eligible for a Chapter 7, or you will have to file a Chapter 13 or 11 instead.

When you file for Chapter 7, you will start with a statement of your financial affairs. This will list your assets, debts and your creditor information. This form must then be filed with the correct bankruptcy court in Florida. Once you file this statement, creditors may no longer attempt to collect on your owed debts.

A trustee appointed by the court will collect any property you have that is not exempt, and sell it off, in order to pay some of your creditors. Some non-exempt assets include:

  • A second car
  • A vacation home or second home
  • Stocks or bonds, investments or cash
  • Antiques and family heirlooms

A 341 hearing is then set, and you will appear under oath, and creditors and trustees can ask questions about your assets and debts.

Florida law states that you can usually keep your home, annuity proceeds, government benefits, child support, alimony, personal property not worth more than $1,000 and any wages up to $500 a week.

Like any laws, Florida state laws for bankruptcies may occasionally change. Additional information can be accessed through the Florida court system or a competent Florida bankruptcy attorney who has a handle on the issues.


Categories: Legal

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