In Chapter 7, a debtor surrenders his or her non-exempt property to a bankruptcy trustee who then liquidates the property and distributes the proceeds to the debtor's unsecured creditors. In exchange, the debtor is entitled to a discharge of some debt; however, the debtor will not be granted a discharge if he or she is guilty of certain types of inappropriate behavior (e.g. concealing records relating to financial condition) and certain debts (e.g. spousal and child support, student loans, some taxes) will not be discharged even though the debtor is generally discharged from his or her debt. Many individuals in financial distress own only exempt property (e.g. clothes, household goods, an older car) and will not have to surrender any property to the trustee. The amount of property that a debtor may exempt varies from state to state. Chapter 7 relief is available only once in any eight year period. Generally, the rights of secured creditors to their collateral continues even though their debt is discharged. For example, absent some arrangement by a debtor to surrender a car or "reaffirm" a debt, the creditor with a security interest in the debtor's car may repossess the car even if the debt to the creditor is discharged.
The 2005 amendments to the Bankruptcy Code introduced the "means test" for eligibility for chapter 7. An individual who fails the means test will have his or her chapter 7 case dismissed or may have to convert his or her case to a case under chapter 13.
Generally, a trustee will sell non exempt assets of the debtor to pay off creditors. However, certain assets of the debtor are protected to some extent. For example, Social Security payments, unemployment compensation, and limited values of your equity in a home, car, or truck, household goods and appliances, trade tools, and books are protected. However, these exemptions vary from state to state. Therefore, it is advisable to consult an experienced bankruptcy attorney. Many people seeking bankruptcy under chapter 7 are new to Florida. If you have been a resident of Florida for under 2 years we will apply exemptions from your former state of residence or in many cases may apply federal exemptions which often protect you even if you have substantial assets.
As much as 65% of all U.S. Consumer bankruptcy filings are Chapter 7 cases. Corporations and other business forms file under Chapters 7 or 11.
Chapter 7 Bankruptcy attorneys fees are reasonable and they include all office appointments, attorney phone calls and emails, preparation and filing of petition, attorney attendance at a creditors meeting, through discharge of debts and related expenses.
After meeting with attorney Berlinsky if an agreement is reached to represent you in a bankruptcy filing you will be provided with a Bankruptcy Questionnaire, which must be completed by you. Furthermore you will need to supply tax returns for the past two years, pay stubs for the past six months, bank statements for the past three months and copies of car titles and proof of auto insurance. Generally a three bureau credit report is prepared to simply the process.
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