Chapter 7 is the simplest and shortest termed bankruptcy one can file. Typically, a Chapter 7 case would take 90 days, depending on the number of an individual’s assets and creditors. Before you can begin filing, it is important to understand the Florida Constitution, Bankruptcy Code, and Florida Statutes pertaining to Chapter 7 bankruptcy. Besides finding out the exemptions you can use to protect property, you also get to know the requirements and the process of filing for a Chapter 7.
How Do I File for Chapter 7 Bankruptcy in Florida?
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Here are the basic steps involved in filing Chapter 7 bankruptcy in Florida:
- Analyze Your Debt
Before you start the filing process, you should start by analyzing your debts to separate dischargeable debts from non-dischargeable debts. Through careful analysis, you can tell the debts that will be forgiven and if you risk losing any of your property. Individuals who have pledged their car or home as collateral for a debt may lose such assets if they are not current when filing for Chapter 7 bankruptcy.
- Ascertain Your Property Exemptions
Florida offers various exemptions to help individuals filing for Chapter 7 bankruptcy protect their property. If you are conversant with the Florida Constitution, Bankruptcy Code, and the Florida Statutes, you can quickly determine which of your property is exempt. In most Chapter 7 cases, individuals can keep their car, personal property, equity in a home, retirement accounts, and public benefits. If you’re unsure of the property exemptions that apply to you, working with a bankruptcy lawyer is a good way of ensuring you protect all the property you can before filing.
- Confirm Your Eligibility
In Florida, individuals filing for Chapter 7 bankruptcy are required to pass the means test, as well as take a credit counseling course and a debtor education course. Some individuals are exempted from the means test, and some are allowed to take the counseling courses after filing for bankruptcy. However, this only happens in cases where the court approves of the reasons cited.
- Redeem or Reaffirm Secured Debts
Individuals who have pledged property such as a car or equity in their home as collateral for a loan will have to continue paying the creditor to keep their property. When filing for Chapter 7, such individuals will have three options:
- “Redeeming” the property, which means paying the creditor the property’s current replacement value in a lump sum,
- “Reaffirming” the debt, which means carrying on with the debt payment as agreed (normally under similar terms)
- “Surrendering” the property, which means allowing the creditor to take it.
- Take a Credit Counseling Course
Before filing your Chapter 7 bankruptcy forms, you are expected to take a credit counseling course from an approved Florida credit counseling agency. You can choose to take this course online or in person, depending on your preference. Normally, you will be expected to take this course before filing your Chapter 7 bankruptcy petition.
- Fill Out the Bankruptcy Forms
Before filling out your bankruptcy forms, you need to collect the necessary Florida bankruptcy documents. Employed individuals would need two years’ tax returns and at least 60 days’ pay stubs. Some bankruptcy trustees may require bank statements or a deed and a mortgage statement from a homeowner.Once you have the necessary documents and information, you are ready to fill out your bankruptcy forms. If you’re filing “pro se” (on your own), you can access the bankruptcy forms on your District Court website. On these forms, you’ll list your income, property, creditors, and property exemptions, as well as state how you want to go about your secured debts. You’ll also need to disclose property transactions that happened ten years prior to filing.Some of the forms you’ll have to fill in a Florida Chapter 7 bankruptcy case include:
- Voluntary Petition for Bankruptcy
- Florida Bankruptcy Schedule A/B: To list all your real property and personal property
- Florida Bankruptcy Schedule C: Exempt property
- Florida Bankruptcy Schedule D: Secured bankruptcy claims
- Florida Bankruptcy Schedule E/F: Priority claims
- Florida Bankruptcy Schedule G: Unexpired Leases and Executory Contracts
- Florida Bankruptcy Schedule H: Co-debtors
- Florida Bankruptcy Schedule I: Income
- Florida Bankruptcy Schedule J: Expenses
- Declaration about Schedules: To state that all the information provided in the bankruptcy schedules is true and correct
- Summary of Assets and Liabilities
- Statement of Intention for Filing Florida Chapter 7
- Statement of Financial Affairs
- Chapter 7 Statement of Current Monthly Income (Bankruptcy form 122A-1)
- Statement About Your Social Security Numbers (Bankruptcy form 121)
- Verification of Creditor Matrix Florida: To certify that you listed all your known creditors and their addresses
- Chapter 7 Credit Counseling Course Certificate
- Florida Bankruptcy Fee Waiver
Individuals filing on their own will have to print these forms and any other local forms required by the local bankruptcy court.
- File the Bankruptcy Forms
Filing your bankruptcy forms, schedules, and other forms officially opens your Chapter 7 bankruptcy case. You can file all the forms at once or opt for an emergency filing to complete specific forms first and file the rest within 14 days. You can hand-deliver or mail in your bankruptcy forms to the Florida bankruptcy court.
- Pay the Filing Fee
Florida residents filing for Chapter 7 bankruptcy have to pay a $335 filing fee to their local bankruptcy court. Individuals earning less than $1,595 or 150% of the federal poverty guidelines are eligible for a filing fee waiver. If you’re ineligible for a filing fee waiver but can’t pay the fee at once, you can ask the Florida bankruptcy court to split it into installments. This helps stop collection by creditors while your bankruptcy petition is pending in court.
- Submit Documents to Your Trustee
After filing your forms in court, you have to submit documents to verify the accuracy of the information on the filed bankruptcy forms. Bankruptcy trustees may request your bank statements, paycheck stubs, tax returns, and profit and loss statements. Usually, you are assigned a bankruptcy trustee after filing your petition in court.
- Take a Debtor Education Course
Chapter 7 bankruptcy filers in Florida are expected to take a debtor education course, which is also known as the post-filing course. Like the pre-bankruptcy credit counseling course, this one can also be taken online or in person, provided it is from an approved Florida credit counseling agency. Upon completion, you’ll receive a certificate that should be submitted to the bankruptcy court.
- Attend the Meeting of Creditors
In most cases, you’ll attend your 341 meeting or creditors’ meeting about a month after filing your bankruptcy petition. It is unusual for creditors to turn up, and you’ll most likely have this meeting with your trustee. If yours is a simple Chapter 7, where all personal property is exempted, this meeting will be brief. Usually, your bankruptcy trustee will ask standard questions that apply to all debtors and specific questions about the information contained in your bankruptcy forms.
- File Objections If Need Be
If you want to eliminate certain liens, or if you’re against a creditor’s claim against you, it is important to address such issues before your Chapter 7 bankruptcy case is closed.
- Finalize On Your Secured Debts
The Florida Bankruptcy Schedule D addresses secured debts and how you intend to hand them. Before your bankruptcy case closes, you need to finalize these matters. For example, if you stated that you’d surrender a car, you should make it available to the lender.
- Get Your Discharge
After going through all the steps above, your process of filing for Chapter 7 is done. Following a successful bankruptcy, the court will discharge all your qualifying debts. This means that you no longer have a legal obligation to pay and that creditors have no right to collect the debt.