The Florida Bankruptcy Guide was created by Perenich The Law Firm, PLLC to guide residents through bankruptcy to insure justice is served for you and your family.
Florida Bankruptcy Guide
You may be drowning in debt. You may be receiving a lot of harassing debt collector calls. You may not able to see a good way out. Let us show you how filing for bankruptcy can help you. Bankruptcy gives you a nice clean slate.
Filing bankruptcy isn’t an indication of failure. It’s a way to get a fresh start and save your future. You aren’t permanently marked by this choice. It can be a very smart choice. Life after bankruptcy is good.
A Look at Life After Bankruptcy
No one comes out of bankruptcy unchanged at least a little. Chapter 13 bankruptcy has you pay off your debts, which means for several years you’re going to have a court made budget to live on. This sounds intimidating, but it’s a good thing. It typically lasts up to five years.
You will learn to live without frivolous purchases. It might also mean that you start to reconsider how you grocery shop and what kind of living situation best suits you now. Chapter 13 doesn’t allow you to fall back on a credit line without approval from a court. It really keeps you humble to what you spend your money on. You come out of this with a better understanding of money management. Do discuss with our Tampa Bay bankruptcy attorneys, however, that for ten years from the date in which you file for bankruptcy, it will stick around with you.
Chapter 7 looks a little different. You can leave behind a lot of your debt. In fact it’ll likely be most of it. Your credit report will reflect the bankruptcy for a decade after you file. Life after bankruptcy means that your spending has to be cash and not credit. You cannot surmount any debt.
Boosting Credit Scores
You may be wondering how in the world you are expected to build credit without using a credit card. It puts you right in that spot between the rock and the hard place, we know.
There are two timelines to start to rebuild your credit. For Chapter 7, it’s going to be immediate. For Chapter 13 you’re going to have to wait until reorganization to build your credit score. Rebuilding credit after bankruptcy is not a straight path. It’s complicated. There are many factors our Tampa Bay bankruptcy attorneys can help you understand.
You may have a decent income which means this process could be better for you. There are things that also make it easier like you still having your home and paying mortgage payments which helps your credit score. Things to consider there is that you will have to have reaffirmed that mortgage loan during an active bankruptcy case. If you did not do that, it means your mortgage lender won’t be reporting that you’ve been keeping up with payments to credit bureaus.
If you’re in an apartment, unfortunately being good about those payments isn’t going to do anything to your credit score because it’s not a loan you’re repaying. That doesn’t suggest you should be delinquent on those payments, if you’d like to keep living there.
When you look at Chapter 7 vs Chapter 13, you can consider that it can be easier to rebuild credit if you file Chapter 7. Chapter 13 makes it a bit harder for you to rebuild your credit after filing. It doesn’t necessarily mean that it is not the right option for you. It’s just something to think about.
As skilled Tampa Bay bankruptcy attorneys, we certainly know that your attitude about this will make all the difference.
You very well might have a harder time getting back into the swing of things, if you don’t have a good mindset going forward.
It’s one thing to have financial ability. That’s all good and well. It’s about how you persevere that defines you.
You need to be able to see the bright side to the future. You need to look ahead and work toward a future where you’re not deep in debt and where you do have savings to fall back onto. These are things you will be proud of yourself for doing, but you need to work to get there. It takes a certain mental fortitude after bankruptcy to do this.
Finances Going Forward
We won’t lie. It’s tough to go on after bankruptcy, but it’s not as tough as staying in that same hopeless place you may be in right now. There’s a future after bankruptcy and it can be a great one. You don’t want to stay in this dark place you’re in right now and you don’t have to. You deserve more than that.
It feels good to file for bankruptcy. It’s a weight lifted. It’s a hope for a good future. Our Tampa Bay bankruptcy attorneys are happy when we see clients in this stage. We do warn them that it’s a rollercoaster. It’s not a straight shot to better days. You need to be prepared for it to be tough. If you can do that, you’ll be in good shape.
You may look back at the ten years between filing and the bankruptcy not appearing in your credit report and be very satisfied with the choices you made. Let us help you get there.
Falling Behind on Mortgage Payments
Once in a while, a client will ask whether they should file bankruptcy when they’re falling behind on mortgage payments. The answer is, well, it depends. Like most answers in the law, it’s really fact-specific. Give me a call. I’m happy to meet with you. We’ll sit down and carefully go through your finances to determine whether or not you are eligible to file a Chapter 7 or a Chapter 13 bankruptcy, and, more importantly, whether you should.
It’s not a one-size-fits-all remedy. It’s a very significant and harsh remedy, sometimes, under the law.
Preparing for Bankruptcy
Sometimes, when I meet with a client, they will ask me what they should do to prepare for filing bankruptcy. Believe it or not, probably the best answer is nothing. What I mean by that is human nature would tell us this is my opportunity to pay off my friend or my family member, or to move assets out of my name, and that is the absolute worst thing that a client can do. The reason is because it draws the scrutiny of the court, the trustee, and the creditors, causes unnecessary complication, and ultimately solves no problems.
The best thing a person can do when considering bankruptcy is to pick up the phone and give us a call. Let’s schedule a time to sit down and go over your finances to determine whether or not you’re even a good candidate for bankruptcy. If there are things that could be done, I would certainly recommend what those are at the time of our consultation.
Differences Between Chapter 7 and Chapter 13
very time I meet with a client, I explain to them the differences between the chapters in bankruptcy. The most typical chapters for an individual are Chapter 7 and 13. In a nutshell, Chapter 7 involves the surrender of assets to discharge debt. Not everybody who files a Chapter 7 has assets to surrender, so it could be a very good thing for them to file a Chapter 7 case. By contrast, a Chapter 13 involves a payment plan, typically three to five years.
Who Should File for Bankruptcy
Occasionally, I’ll get the question, “Should I file for bankruptcy, and, am I a good candidate for bankruptcy? Will it really help me?” The answer depends on a really detailed analysis of the client’s assets, liabilities, income, and expenses. Not everybody who comes to me about bankruptcy is a good candidate for bankruptcy. When the facts warrant it, we pursue a different route.
Handling Creditors After Bankruptcy
One question always comes up when I meet with clients— what do I do about my creditors now that I’m filing bankruptcy? Under federal law, creditors are not allowed to write letters, call, file lawsuits, serve process, garnish wages or bank accounts when you have filed bankrutpcy. Bankruptcy provides an automatic stay that stops all creditor collection activity— a huge peace of mind component to filing a bankruptcy case.
How Long Bankruptcy Stays on a Credit Report
Occasionally, in a bankruptcy case my client will ask, “How long does the bankruptcy case remain on the credit report?” This is a great question. It’s under federal law. In a Chapter 7 case, the bankruptcy can remain on the credit report for ten years. In a Chapter 13, it can remain on a report for seven years from the date of discharge, which is typically five years down the road, so it’s a total 12-year impact. I tell this to most of my clients, as well— credit is not the beginning and end of the analysis when we consider whether a person should file bankruptcy or not.
Bankruptcy Affects Credit Score
Almost always a client will ask me what a bankruptcy will do to their credit. The short answer is that it’s going to hurt your credit, but most people who are in the consideration stage of bankruptcy already have impaired credit. What I tell my clients is that, on a scale of one to ten, your finances are level ten and your credit is probably at level two in terms of what’s important. The reason is simply this – ultimately your credit will follow your finances. When a person straightens out their financial picture, the credit problem solves itself.
Rebuilding Credit After Bankruptcy
When I meet with clients, I always discuss what we can do, even from the beginning of the bankruptcy case, to make their credit look better. The answer is just responsible spending. A person can get a small credit card that they pay off – and by small, I mean a low credit limit that’s paid off every month responsibly – essentially, just paying the bill on time. These are excellent ways to improve credit. Credit typically improves very quickly after bankruptcy over time.
If Spouse Files Bankruptcy
Almost always when I represent one spouse who is considering bankruptcy, they will ask whether or not their bankruptcy will affect their spouse or their spouse’s finances, and the short answer is no. You can’t impair your spouse’s credit by filing your own bankruptcy. At the same time, it won’t remedy any financial problems that the spouse will have. If the client is filing a Chapter 13 bankruptcy, however, Chapter 13 requires that the entire household income is dedicated to the Chapter 13 plan, so it would affect the spouse only in the sense that their earnings would be part of the entire analysis of what the payment would be under a Chapter 13 plan.
Call Our Tampa Bay Bankruptcy Attorneys Today
If you want to know more about bankruptcy, please get in touch with our Tampa Bay bankruptcy attorneys today. You deserve to have someone skilled and caring walk you through this. Contact our office today to set up a consultation.
Let the experienced bankruptcy creditor protection attorneys at PERENICH The Law Firm help. As Tampa Bay bankruptcy attorneys with offices in Clearwater, Tampa, St. Petersburg, Tarpon Springs, and New Port Richey, we understand that the unexpected happens in life. Our personal bankruptcy attorneys have more than 20 years of experience and have represented thousands of consumers and businesses in bankruptcy cases.
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