Florida Chapter 7 Bankruptcy Attorney
If you are struggling with high levels of debt you can no longer manage, Chapter 7 bankruptcy may be the right option for you. Chapter 7 bankruptcy does not forgive your debt, nor does it eliminate it completely. Chapter 7 simply discharges your debt, meaning you are no longer legally obligated to pay it. The debt will still appear on your credit score, even though creditors can no longer try to recover it. If you are thinking about filing, our Florida Chapter 7 bankruptcy attorney explains what you need to know below.
Qualifying for Chapter 7 Bankruptcy
There are many eligibility requirements for Chapter 7 but one of the most important is the means test. The means test compares your household income with the state average for households of the same size. If you are below the state average, you are eligible for Chapter 7. The means test was introduced into bankruptcy law nearly two decades ago to prevent abuse of the system. As its name suggests, the means test is meant to determine if you have the means to repay the debt.
If you do not pass the means test, you can still file bankruptcy although you cannot file Chapter 7. Most people who do not qualify under the means test end up filing Chapter 13 bankruptcy. Before filing Chapter 7, you must also complete a credit counseling course and submit a certificate of completion from an approved agency within 180 days in order to qualify.
What Debt Can You Discharge in Chapter 7?
The goal of Chapter 7 is to discharge most or all of your consumer debt. Some of the most common types of debt discharged through a Chapter 7 are as follows:
- Credit card debt
- Vehicle debt
- Small business or personal loans
- Payday loans
- Utility bills
- Medical debt
While Chapter 7 can discharge much of your debt, there are other types of debt that are classified as non-dischargeable debt. These include:
- Income tax and property tax debt
- Alimony and child support obligations
- The majority of student loans, unless you can prove they are causing an undue hardship
- Debt obtained through false or fraudulent means
When is the Right Time to File Chapter 7?
If creditors and debt collectors are calling you regularly trying to recover debt, or they have taken legal action against you, it may be time to file Chapter 7. However, there are also certain times when you should reconsider filing. For example, if you recently received a bonus at work, an inheritance, or another temporary windfall, you may want to wait before you file. These types of windfalls will be considered as income and may disqualify you through the means test.
Our Chapter 7 Bankruptcy Attorney in Florida Can Help
At Ronald Cutler, our Florida Chapter 7 bankruptcy attorney can help determine if you qualify and guide you through the process so you do not lose property and get as much debt discharged as possible. Call or text us now at 386-490-9949 or contact us online to schedule a free review of your case.
