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When you file a Jacksonville Bankruptcy, you are required by the United States Bankruptcy Code to list all of your assets in your Bankruptcy Petition. The reason being is to assist the Court, and your appointed Trustee, in figuring out which of your assets you are allowed to keep, and which of your assets you must turn over to your Bankruptcy Estate. The assets surrendered to your Bankruptcy Estate are liquidated to pay your creditors. If there is an asset you wish to keep, then you must accurately list that asset in your Bankruptcy Petition as well as the exemption (if applicable) that allows you to retain the asset.

The biggest hurdle is figuring out what your assets are and what exemptions are available to you. By definition, an asset is anything that has a value and that which can be sold or liquidated in order to pay your debts or commitments. The most common looked over assets are whole life insurance policies, as well as insurance policies in which you are the named beneficiary, accrued or unused vacation pay, timeshares, season tickets, unpaid insurance claims, security deposits, class action lawsuits, trademarks, liquor licenses, divorce settlements and tax refunds.

I cannot stress to you enough the importance of disclosing all of your assets. One accidental omission could have devastating consequences. Take this situation as an example:

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carmini-150x150While it is true that the exemptions allowed in Florida only allow you to keep $1,000.00 of equity in a motor vehicle, most people who file bankruptcy in Jacksonville, Florida get to keep their vehicles. This is because financed or leased vehicles can just about always be kept by simply continuing to make your normal monthly payments as if the bankruptcy was never filed. This is of course as long as the vehicle is a reasonable necessity for your, or your dependents’, care and support.

What if my vehicle has equity?

A different set of rules applies however when your vehicle has equity that is above the $1,000.00 exemption that is allowed in Florida. For example, when you owe your vehicle free and clear. In such a situation, you might be able to use a wild card exemption to protect the rest of the equity. However, if you are unable to exempt all of the equity, then you may be forced to surrender the vehicle or pay your Trustee the un-exempt equity amount in order to keep the vehicle. Most of the time, your Trustee will allow you to make monthly payments for the equity.

There are two tests that the Trustee will do in deciding if you should keep your vehicle. The first is to determine whether it is feasible. Meaning, if the monthly payments are reasonable and affordable for you. The second and more significant test when keeping the vehicle is whether it is in the “best interest of your creditors.” United States Bankruptcy Code 11 U.S.C. § 1129(a)(7)(A)(ii) states that in a Chapter 13 Bankruptcy, your creditors must receive, at the very least, the amount they would have received had you filed a Chapter 7 Bankruptcy. As an illustration, if you own a motorcycle and wish to keep it in your Chapter 13 Bankruptcy, then if that motorcycle would have been liquidated in a Chapter 7 Bankruptcy, then you will either have to surrender the motorcycle or pay the value of it through your Chapter 13 Plan. Continue reading →

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pastdue-150x150If you fall very far behind on your credit card payments, or any other kind of debt for that matter, your debt might appear as having been charged-off on your credit report. A charge-off occurs when you are at least 180 days behind on your credit card payments, and the bank decides that the debt is no longer collectible and decides to write it off as a loss. However, this does not mean you no longer owe the debt. You are still 100% responsible for the debt. But what do you do and what should you expect?

The debt will have to be repaid.

At first, you might think that it is a good thing that your debt has been charged-off and you might even think that you no longer owe the debt. Unfortunately, when your bank decides your account is uncollectible, that is simply an accounting term. It in no way affects your liability for the entire debt owed. However, there is one caveat. The bank can only collect on the debt until the statute of limitations expires. In Florida, the statute of limitations for a credit card debt is five years. Continue reading →

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Just like all other legal processes and proceedings, bankruptcy can not only be difficult to navigate, but it can also be a little bit scary. Luckily, most of the things about bankruptcy that make it seem like a scary and difficult process happen to be nothing other than misinformation. This is why it is so important to speak with an experienced Jacksonville Bankruptcy Attorney who can aid you in weighing your options, assist you in deciding if bankruptcy is right for you, help you understand exactly what to anticipate when filing bankruptcy, and inform you on how filing bankruptcy will affect your today as well as all of your tomorrows. The more knowledge you have and the more you are prepared the easier it will be to make filing bankruptcy as easy and smooth of an experience as possible. Here are some of the biggest bankruptcy fables debugged:

Fable 1: Those who file bankruptcy are fiscally irresponsible.

Of course, there will always be individuals who are irresponsible and abuse the right to file bankruptcy. But in reality, the majority of people who file bankruptcy are good people with good intentions who have suffered a job loss, a divorce or illness. All of which have either lowered their income or increased their expenses, which in turn, have prevented them from being able to pay all of their expenses.

Fable 2: If I file for bankruptcy, everyone will know.

Yes, who files bankruptcy is public knowledge, but that is only because most bankruptcy documents are a public record, which is the same with the majority of all other legal proceedings. However, the fact that you filed bankruptcy will not be published in your local newspaper. In order for someone to find out that you have filed bankruptcy, they will most likely have to run a background check or pull your credit report. The other exception is for attorneys. Most attorneys have usernames and passwords that allow them to search the bankruptcy court dockets. Continue reading →

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Protect_thumb-150x150Every six months, specifically in May and November of each year, the United States Department of Justice updates the Median Family Income figures in every state. In turn, these figures determine whether an individual or a couple qualify to file a Jacksonville Chapter 7 Bankruptcy. More specifically, if your income is below the median income for your household size in your state, then you most likely qualify for a Chapter 7 Bankruptcy; however, if your median income is above the income allowed for your family size in your state, then you will have to file under Chapter 13 of the United States Bankruptcy Code.

How do I know if my income qualifies for a Chapter 7 Bankruptcy in Jacksonville, Florida?

You will have to pass something called the MEANS Test in order to qualify for a Chapter 7 Bankruptcy in Jacksonville, Florida. The MEANS Test is more or less a comparison between your income over the last six months and your household size.

The Median Family Income in Florida as of November 1, 2016 are:

  • Family size of 1: $3,668 per month, or $44,021 per year;
  • Family size of 2: $4,555 per month, or $54,655 per year;
  • Family size of 3: $4,990 per month, or $49,881 per year;
  • Family size of 4: $5,957 per month, or $71,480 per year;
  • Family size of 5: $6,657 per month, or $79,880 per year;
  • Family size of 6: $7,657 per month, or $88,280 per year,
  • Family size of 7: $8,057 per month, or $96,680 per year.

For each additional family member you have, you can add $7,500 per year. Continue reading →

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protect-money-umbrellaAs 2016 comes to an end, the 2017 Tax Season will begin. Federal law requires that all employers provide their employees with their W2s no later than January 31st, so that federal income taxes may be filed by April 18th. Bankrate predicted in 2015 that thirty percent of the public who would receive a 2014 tax refund would use that refund to assist them with lowering their debt and that many of this thirty percent would use their tax refund to file a Chapter 7 or Chapter 13 Bankruptcy. This statistic has remained unchanged for many years.

The most advantageous benefit to using your tax return to help you file a Chapter 7 or Chapter 13 Bankruptcy is that using your tax refund to fund your bankruptcy allows you to use your refund in an essential and reasonable manner. When you use your tax refund in an essential and reasonable manner such as filing bankruptcy, then your tax refund most likely will be protected from your creditors and well spent. Continue reading →

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home-in-foreclosure-thumb-250x166-2941When the foreclosure crisis began, many Jacksonville Foreclosure Defense Attorney’s argued that a mortgage foreclosure action must be brought within five years after the borrower defaulted on their mortgage payments. However, time and time again the Foreclosure Judges in the Jacksonville and surrounding areas ruled that mortgage foreclosure actions were not barred by Florida’s five year statute of limitations as defined by Florida Statute 95.11(2)(c). Yet, the Florida Supreme Court had not spoken on this matter until now.

The Florida Supreme Court has finally spoken and confirmed that Florida’s five year statute of limitations, which is a question of great public importance, defined by Florida Statute 95.11(2)(c) does not apply to mortgage foreclosure actions. The decision came on November 3, 2016 in U.S. Bank v. Bartram; SC14-1265 (Fla. Nov. 3, 2016). The certified question before the Florida Supreme Court answered is as follows:

Does acceleration of payments due under a residential note and mortgage with a reinstatement provision in a foreclosure action that was dismissed pursuant to Rule 1.420(b), Florida Rules of Civil Procedure, trigger application of the statute of limitations to prevent a subsequent foreclosure action by the mortgagee based on payment defaults occurring subsequent to dismissal of the first foreclosure suit?

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As a Jacksonville Bankruptcy Lawyer I have had many clients come to me to file bankruptcy with many misconceptions about bankruptcy. Because of these misconceptions, clients often put off filing bankruptcy until they have absolutely no other option. Yet most of these misunderstandings are false. Here are the most common misconceptions my clients have had about filing bankruptcy. In fact, after reading this filing bankruptcy might not seem as scary of a process.

1. Credit:

The most common misconception I have heard about filing a Jacksonville Bankruptcy is that filing bankruptcy ruins your credit and you will never be able to get credit again. This notion is absolutely false. However, it is true that a bankruptcy filing can appear on your credit report for up to 10 years. However, this does not necessarily mean the bankruptcy will hurt your credit rating. In reality, filing bankruptcy most likely will only help improve your credit score. The reason that filing bankruptcy will help improve your credit score is because your credit score is most likely already ruined by the time you file bankruptcy. Therefore, filing bankruptcy will likely not do any more damage to your credit report. Instead, filing bankruptcy helps to improve your credit report by taking away your credit card balances, stopping all of the negative credit reporting and finally giving you the opportunity to start improving your credit report.

If you file a Chapter 13 Bankruptcy you can even obtain new credit during your Chapter 13 Plan. You will just have to obtain permission from the court first. If you file a Chapter 7 Bankruptcy, then you might find that you receive many new credit card offers in the mail in no time after receiving your Bankruptcy Discharge. This is because you no longer have any debt and are seen as a good candidate for credit by credit card companies. But, keep in mind these credit card offers aren’t going to have the best interest rates. However, over time, as long as you pay your credit card on time each month, you will improve your credit score and will be able to get a credit card with a good interest rate in the future. Continue reading →

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debtWhen thinking about filing a Chapter 7 Bankruptcy in Jacksonville, Florida, not knowing or understanding the Jacksonville Bankruptcy Process can make filing bankruptcy seem very overwhelming and scary. Not only are Jacksonville Bankruptcy Attorneys asked about what to expect after filing bankruptcy; they are also asked what clients should and should not do before filing for bankruptcy. In order to help you better understand the Jacksonville Bankruptcy Process, please see below for a general timeline of events you should be familiar with.

6 to 8 Years Before Filing a Jacksonville Chapter 7 Bankruptcy:

If you filed a Chapter 7 Bankruptcy before AND received a discharge of your debts, then you will not be eligible to file a new Chapter 7 Bankruptcy before eight years after you filed your previous Chapter 7 Bankruptcy.

If you filed a Chapter 13 Bankruptcy AND received a discharge, you might be able to file a Chapter 7 Bankruptcy after six years if you paid a minimum of 70% of your unsecured claims.

1 Year Before Filing:

Your Bankruptcy Trustee can look back as far as one year for debts paid back to relatives or close business partners. What this means is that a payment made to a relative or business partner could be construed as a preferential payment over your other creditors. If this should happen, the Court could take the payment back from them in order to distribute it evenly to all of your other creditors.

This same concept holds true if you have tried to hide your assets from your creditors by transferring, destroying or hiding any of your property within one year of filing Bankruptcy. In this situation, the Trustee might deny a Chapter 7 Bankruptcy discharge and/or recover the property.

However, your Jacksonville Bankruptcy Attorney may prefer that you wait two years to ensure there are no issues when you do file. Continue reading →

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One of the best benefits of declaring a Chapter 13 bankruptcy in Jacksonville, Florida is the ability to “Cram Down” certain assets such as a car loan, certain real estate debts, or even some personal property. A cram down allows debtors to lower the principal balance and interest rates on debts they owe on secured debts. A Jacksonville Bankruptcy Attorney can help you determine if any of your debts might be eligible for a cram down through bankruptcy.

So how does an asset qualify for a cram down? First, the debt must be a secured loan. A debt is a secured loan when a lender has a security interest in the asset or collateral. This interest grants the lender certain rights to the asset, such as the right of repossession of the item if the debtor defaults on his or her payments. The most common type of security interests are found in cars and houses.

A cram down can occur when a person declares a Chapter 13 Bankruptcy. Unlike a Chapter 7 Bankruptcy, this type of bankruptcy requires that the debtor pays back his or her debts through a repayment program, which lasts 3 to 5 years.   It is important to note that a person’s homestead property does not qualify for this benefit. Continue reading →

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