Bankruptcy and Reorganization to Rebuild your Future


The economic crisis of the past year has caused nationwide financial instability. Many are dealing with tumbling credit scores, housing evictions, and the stress of unpaid bills, over-extended credit, mounting medical debt, and more. Joblessness has catapulted, and hundreds of thousands of workers across the country remain unemployed. Small businesses and large corporations are in survival mode to continue operations. Both seasoned professionals and new college graduates are experiencing fear for their financial future in this time of uncertainty.

   The fallout from the economic crisis, sparked by the pandemic, is expected to cause a dramatic increase in bankruptcies this year. Researchers at Harvard Business School, Brigham Young University, and MIT School of Management expect the nation will see an increase in bankruptcies by as much as 140% in 2021.

Chapter 7 and Chapter 13

   In Florida, a Chapter 7 bankruptcy is the most common legal procedure to resolve over-extended finances for individuals and corporate entities. To file a petition for a Chapter 7, an applicant must be a permanent resident of Florida or own property in this state. A bankruptcy court utilizes a means test to determine eligibility through a detailed analysis of assets and expenses. The process involves giving all non-exempt assets to a court-approved trustee. The assets are liquidated and the proceeds distributed to the creditors in accordance with the provisions of the Bankruptcy Code. The debtor emerges from this type of bankruptcy with no further financial obligations to creditors.

   A Chapter 13 bankruptcy is considered a reorganization plan to repay creditors within 3-5 years for past due debts. It is appropriate for individuals and sole proprietors of a business. To initiate this type of bankruptcy, the debtor files a petition containing a statement of income and dispensable income, estimating the commitment period to pay off the creditors.  A bankruptcy court must approve the financial plan, and a Chapter 13 court-approved trustee supervises the repayment of debts.

Dischargeable and Non-Dischargeable Debts

  Dischargeable debts are those financial obligations that can be forgiven in a bankruptcy proceeding. It may include credit card debt, medical bills, personal loans, utility bills, and other debts at the court’s discretion. Under the Bankruptcy Code, debts that are not dischargeable include alimony, child support, taxes, criminal fines, criminal restitution, and student loans. Under the Fair Credit Reporting Act, a bankruptcy filing is available on a credit report for ten years.

Benefits of Bankruptcy

   Surviving the emotional toll of bankruptcy is challenging. However, it is a process that can help rebuild your future and offers a fresh start for individuals and businesses. There are bankruptcy laws that protect your homestead property, a portion of your personal property, and automobile. Once a petition is filed, a bankruptcy suspends the actions of bill collectors. It eliminates the daily stress of eviction or foreclosure, wage garnishments, and property repossession. Social Security benefits, worker’s compensation, and unemployment benefits are exempt from wage garnishment. There may be other exemptions from creditors such as pensions, college saving funds, disability income and benefits, and 401K plans.

Search the Southern Cross Media’s Lawyer Directory for the Best Legal Counsel

   Bankruptcy laws are complicated, and your financial future is at stake. An experienced bankruptcy lawyer can assess your situation and guide you through the process of debt relief so that you can start to rebuild your future.

To find a bankruptcy law firm that successfully assists distressed individuals and businesses during tough economic times, consult the Southern Cross Media’s Lawyer Directory. Our highly-rated and comprehensive Lawyer’s Directory provides information about local attorneys that you can trust and will put you at ease. We list the best law firms by practice area, location, and reputation, including peer and client reviews.

The Southern Cross Media Lawyer’s Directory can help you locate a law firm that is highly knowledgeable in bankruptcy law and understands your financial situation. The right attorney will have a positive and immediate impact on your life.