The Guidance To Liquidate Your Debt Through Chapter 7

In general, people file Chapter 7 to eliminate credit card debt, medical bills, judgments, repossessions, mortgage deficiencies and certain personal taxes. A Chapter 7 bankruptcy also allows you to surrender a house or a car that is worth less than the balance of the mortgage or loan and to terminate a lease early without repercussion.

If you are considering Chapter 7, we can help you. As the founder of Mark S. Steinberg, P.A., attorney Steinberg has helped clients throughout Florida liquidate their outstanding debts through strategic bankruptcy petitions for more than 30 years.

Chapter 7: What To Know

Once you file for bankruptcy, creditors and their collection agents must stop calling you and mailing you bills. Any pending lawsuits and wage garnishments will also stop. But Chapter 7 comes with conditions:

• First, some debts cannot be discharged in Chapter 7. This includes student loans, child support, alimony and recently assessed taxes.
• Second, you can only file Chapter 7 bankruptcy if you meet a minimum income test.
• Third, if you qualify under the income test, you can only keep a limited amount of belongings. Any belongings in excess of the limits may potentially be taken by the bankruptcy trustee to pay a portion of your debt.

The bankruptcy will stay on your credit report for 10 years. However, during that time, your credit score will generally improve because the bad credit is no longer used as one of the determining factors. Before long, you will be able to get a new credit card and even auto financing. Chapter 7 is usually the best choice if you have very few belongings, a limited income, and a large amount of unsecured debt. It is an excellent way for people in that situation to get a fresh start in life.

Questions To Consider Before Filing

Chapter 7 bankruptcy can affect your income, property, credit and long-term financial recovery. Before you file, it may help to understand the following:

What is the “means test,” and how do I know if I qualify for Chapter 7 in Florida?

The means test helps determine whether your income allows you to file for Chapter 7 bankruptcy. It looks at your household income, family size and certain allowed expenses. If your income is below the Florida median for your household size, you may qualify. If your income is higher, you may still qualify after deductions for necessary expenses, secured debt payments and other required costs.

Can I keep my home and car if I file for Chapter 7 bankruptcy?

You may be able to keep your home or car if available exemptions protect your equity and you stay current on payments. This depends on the value of the property, the balance owed and whether the payments still fit your budget. If the house or car is worth less than the debt, or if the payments are no longer manageable, Chapter 7 may also allow you to surrender the property without continuing personal liability for the remaining debt.

How long does the Chapter 7 bankruptcy process take from start to finish?

Many Chapter 7 cases take several months from filing to discharge. The exact timeline depends on how quickly you complete the required paperwork, whether the trustee requests more information and whether any creditor raises an objection. A straightforward case may move faster, while cases involving property, income questions or incomplete records may take longer.

What is an automatic stay in Chapter 7 bankruptcy?

The automatic stay is the legal protection that begins when you file your bankruptcy case. It can stop most collection calls, billing letters, lawsuits, wage garnishments and other creditor actions while the case is pending. This protection gives you time to move through the bankruptcy process without constant collection pressure, although it may not stop every debt or court matter.

Do I need a lawyer to file Chapter 7 bankruptcy?

You are not required to have a lawyer, but bankruptcy mistakes can affect your property, delay your case or prevent a discharge. A lawyer can review your debts, exemptions, income and risks before you file. Mark S. Steinberg, P.A., can also help you understand whether Chapter 7 is the right option or whether another debt relief strategy may better fit your situation.

Learn More About Chapter 7 Today

You deserve wise counsel from an experienced bankruptcy lawyer. We provide free, confidential initial consultations in which you can discuss your situation. To set up an appointment, please call our Miami office at 786-744-4746 or send us an email.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.