What are the different types of Bankruptcy?
There are actually many types, from Chapter 9 for cities (such as Detroit filed), Chapter 12 for farmers, Chapter 11 for larger businesses. But the two main types that are used by Individuals, for Consumer Debts, are Chapter 7 and to a lesser extent, Chapter 13.
Chapter 7 simply eliminates for good debts such as credit cards, medical bills, left over amounts from car repossessions or house foreclosures, and just about any other debt you can think of other than, in most cases, back child support or alimony, student loans, and sometimes back taxes.
Chapter 7 is usually less expensive and quicker than Chapter 13.
Chapter 13 can sometimes be helpful where someone has too much in excess assets, or doesn’t qualify for Chapter 7 because of a high income. However it does involve a partial payment plan over a number of years. Because of the extra cost, and the fact that many cases just don’t make it all the way though, I only handle Chapter 7 cases.
Can I ever own anything again?
Of course, though this is a very common concern or myth. In general, the only things that count are what you own on the day your case is filed. There is certainly no reason you can’t own something else right afterwards (whether you buy something outright or on credit, or receive a something from someone else).
Where Does Your Typical Client Live?
My main office in is Ocala, which is in Marion County, Florida.
However, bankruptcy law goes by large Federal Districts, so many of my clients (probably at least half) come from other counties, such as Sumter, Citrus, and Lake Counties. If it is inconvenient for any reason for you to meet with me in the office in Ocala, I also offer free initial phone appointments, and much of the case can be handled without requiring much travel by you.
Will I have to go to Court?
For the most part, no. There is a lot of paperwork that goes into each case, and that is what the court relies on for the most part. The most important thing to me is to prepare your case correctly before filing so everything goes smoothly. There is one short appearance you have to make in the bankruptcy courthouse, but it’s not in a courtroom, in every Chapter 7 case. I call this an “I.D. Check” meeting, because the Chapter 7 trustee appointed to each case has the job of checking your identification, simply to prevent identity theft, by making sure it is really you, and not someone forging their name to papers with your name on them.
I feel guilty, like a failure, embarrassed: Is filing Bankruptcy “Right?”
These feeling are not at all unusual. This is widely considered one of the most emotional areas of law. However, even the Founding Fathers decided it was the right thing to provide for in the original Constitution (not even one of the later amendments).
Throughout history, there have been honest and good people, who’ve had unfortunate occurrences, and just needed some help.
We all want to do the “right” thing, but sometimes I think we need to pose the question as which is the “most” right thing to do.
For instance, is it right for you or your family to struggle to survive and meet even the basic necessities? Would the right priority be for you to be homeless, but still sending off payments to multi-billion dollar companies, that are just as happy to get a tax write-off if they get a bankruptcy notice?
Finally, given the statistics, I’ll bet you know 10 or 20 people who have filed bankruptcy, but you may not know who they are. Many people don’t tell even their closest relatives or friends that they’ve filed bankruptcy.
What Are The Typical Causes?
Everybody is different; every story I hear from each client is different. However, I believe there are a few main causes. These include things such as:
Death or divorce of a spouse (or really, anyone who used to help with everyday expenses, and that help is no longer there).
Sudden job loss, or just a long process of being underemployed or underpaid (wages and social security payments haven’t really kept up with inflation).
Medical. This is a big one. It may not be the medical bills all by themselves, but the fact that the medical issue has caused you to lose work, even temporarily interrupting your cash flow. Then, there’s the additional and sometimes ongoing expenses of the medications or treatments involved. Medical issues can be all-pervasive in the way the affect you or your family’s finances.
Can I file Bankruptcy Again?
With a few exceptions, you can file Chapter 7 bankruptcy every 8 years. Most of my clients never thought they would need to file in the first place, let alone, a second or third time. But, life throws unexpected events at us all the time. It can sometimes feel discouraging to file another bankruptcy case, but Congress designed it this way for a reason. The key is that, rather than looking at any bankruptcy as a defeat, it’s a way to keep moving forward with your life. See that you are taking the right steps for you and your family, despite what events happen in life and you will see there’s nothing to be ashamed of, but that you should congratulate yourself for facing this new problem head on. If you can see that it’s going to be necessary, it’s a good idea to get in touch with me before the 8 years is up. That way, we can prepare properly for when it is time to file.