How does a fresh start sound to you?

There is no reason whatsoever to be ashamed about the prospect of filing for bankruptcy. Bankruptcy is a right afforded to every United States citizen under the Constitution, and the entire purpose behind the bankruptcy laws of this country are in order to provide a fresh start for individuals who have fallen into financial distress or are struggling because they can no longer afford to pay their bills.

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Some of the most common questions that people who are contemplating bankruptcy have are:

  • What type of debts can be discharged in bankruptcy?
  • How long will bankruptcy affect my credit?
  • Which assets or personal belongings are exempt from bankruptcy?
  • How long does the bankruptcy process take?
  • Which bankruptcy should I file?
  • Can I file an individual bankruptcy if I'm married?
  • Are my wages protected from bankruptcy?
  • What about my savings? Can I keep money if I file bankruptcy?
  • Can I keep my car?
  • Can I keep my credit cards?
  • How will bankruptcy affect my business?
  • What if I cannot keep up with my Chapter 13 repayment plan?

Chapter 7 Bankruptcy

Chapter 7 Bankruptcy is the most common and straightforward bankruptcy option available to most people. Chapter 7 Bankruptcy is often referred to as a liquidation bankruptcy. By filing a Chapter 7 Bankruptcy you may be able to eliminate most or all of your debts and have a fresh start in as little as a few months. Chapter 7 is not available to everyone, therefore the bankruptcy court uses the "Means Test" to measure income and expenses to determine if someone qualifies for Chapter 7 Bankruptcy relief. Individuals are often able to discharge tens or hundreds of thousands of dollars in debt through a Chapter 7 Bankruptcy. Some of the debt situations that may be eliminated in Chapter 7 are:

  • Medical bills
  • Credit card debt
  • Wage garnishment
  • Business debt that was personally guaranteed
  • Legal judgments
  • Repossessions
  • Collection agencies
  • Student loans (not common, must be a unique situation)

There are various Florida laws that affect what types of exemptions are available to someone seeking Chapter 7 Bankruptcy protection, so make sure you consult with a qualified and knowledgeable bankruptcy attorney that can help educate you as to what your rights are prior to filing for bankruptcy.

Chapter 13 Bankruptcy

Chapter 13 Bankruptcy is often referred to as a reorganization bankruptcy. Where in Chapter 7 the goal is to discharge all the debt and move on, people who file Chapter 13 Bankruptcy often do so to benefit from the many advantages of saving their homes, reducing their mortgages, and restructuring mortgages on multiple properties so that they become more affordable. A Chapter 13 Bankruptcy usually involves a repayment plan that is spread out over an average of 5 years, so that people can keep their assets and make their debt situation more manageable.

In a Chapter 13, many types of debt can still be liquidated, while simultaneously allowing for the restructuring of mortgage or automobile debt. Due to the multitude of options available, a Chapter 13 allows consumers much more flexibility and provides for many beneficial options. In addition, individuals who simply cannot qualify for a Chapter 7 due to too much income also often file chapter 13.

Benefits of Filing Under Chapter 13

The benefits to filing a Chapter 13 for homeowners, especially people with multiple properties or investment properties are tremendous. If you are a homeowner or property investor trying to save your home or investment properties in a Chapter 13 Bankruptcy, there are many tools available. For example, you may be able to strip off (eliminate) a second or third mortgage or other lien on the home, cram down a first mortgage on an investment property and pay what the property is worth instead of what you owe, as well as catch up on missed payments by spreading them out over 5 years to bring your mortgage current.

While there are no income limitations to file a Chapter 13 Bankruptcy, there are limits to how much secured debt you can have and still qualify for a Chapter 13 Bankruptcy. It is important that you consult a knowledgeable and experienced law firm to help you navigate the various beneficial options available prior to filing a Chapter 13 Bankruptcy.

Chapter 11 Bankruptcy

Chapter 11 is a complex bankruptcy option that is most often used by businesses. Nevertheless, if an individual consumer cannot pass the Means Test and their secured debt is above the limits allowed by Chapter 13, they may have no alternative but to file an individual Chapter 11. Chapter 11 is also considered a reorganization bankruptcy. While Chapter 11 is a time consuming, complex, and often expensive way to go, it can offer many benefits to businesses or consumers who don't qualify for a Chapter 7 or 13.

Chapter 11 Bankruptcy may provide unique solutions to minimize business risk and financial loss, and at the same time, allow the business owner the ability to continue running the business and remain in operation.


At times, bankruptcy is most effective when used immediately, and in other situations, it's better to litigate or negotiate the underlying debt issues and hold off with the bankruptcy until it is determined that it's absolutely needed. Don't be taken advantage of by bankruptcy filing mills that treat every case the same and put every client that walks into their door immediately into bankruptcy. At Charles Legal, I know how to guide you through the bankruptcy process and attempt to resolve the underlying debt issues and avoid bankruptcy for my clients altogether.

If you are contemplating filing bankruptcy or just want to find out some more information and what options are available for you, don't hesitate. Call Charles Legal, PLLC. today at (786) 322-8150 for a free consultation to find out how I may be able to help you.