Miami, Florida Bankruptcy Lawyers

Do I have to Qualify for Bankruptcy?

In general, there is no standard requirement for filing for bankruptcy. However, whether or not your income is more or less than the median income in the state of Florida will determine whether you can file under Chapter 7 or must file under Chapter 13. These questions are best answered by speaking to an experienced bankruptcy attorney. Contact the bankruptcy attorneys at Kingcade & Garcia today.

What is the difference between Chapter 7 and Chapter 13 Bankruptcy?

In order to file under Chapter 7, your income must be less than the median income in the state of Florida. If you qualify, your unsecured debt - credit cards, medical bills, and certain kinds of loans - will be wiped out. However, the court may sell some of your property in order to pay your creditors a portion of what you owe. Typically, non-essential or luxury items are sold. If you cannot maintain monthly payments on your house, it may be foreclosed upon as well.

In a Chapter 13 bankruptcy, your debt is restructured according to a payment plan agreed to by your creditors. A trustee is appointed by the court, tasked with ensuring you make payments on time and creditors receive what they are owed. In general, people who file under Chapter 13 are required to pay back 80% to 100% of what they owe over the course of 3 or 5 years.

I need to file for bankruptcy but my Spouse doesn't. Can I file alone?

Yes, if the debt in question is yours and yours alone. If, for example, you have debt on credit cards that are in your name only, you can file alone. However, since you are married and presumably jointly own a home or other property with your spouse, your spouse's financial information will need to be reported on bankruptcy documents.

Can I get a Credit Card after Bankruptcy?

It is relatively easy to rebuild your credit after bankruptcy. If you diligently pay your bills, especially your mortgage, and do not fall behind on payments, you should be able to qualify for a low-balance credit card a few months after filing for bankruptcy. If you handle your credit card responsibly, you can often quickly improve your credit score.

Should Cancel I Cancel My Credit Cards to Improve My Credit Score?

Your credit score reflects a number of factors - not just whether you are late on payments. Creditors look at how much credit you have in proportion to your debt. So, for instance, if you have 4 credit cards with a credit line of $10,000 on each, your credit line equals $40,000. If you have $5,000 of debt on each one, you owe 50% of your total credit line. If you decide to cancel two cards and consolidate the remaining balance on the other two cards, you would now have $20,000 in credit and $20,000 in debt. This would hurt your credit score since your cards would now be maxed out.

If you are trying to protect your credit score or rebuild it, cancelling credit cards may be counterproductive. Additionally, applying for credit cards in order to transfer balances on existing ones could negatively impact your credit score. When creditors check your credit report, other creditors often assume it's because you need to borrow money or apply for additional credit to handle existing debt. As a result, your credit score could be reduced.

How long will my Bankruptcy take? Will My home be Protected?

While each case is different, the typical Chapter 7 bankruptcy takes roughly 90-100 days from start to finish. During this time, creditors have to stop contacting you and must communicate with you through your attorney. If you are facing foreclosure, filing for bankruptcy may delay the foreclosure process.

If you would like additional information regarding bankruptcy and how our lawyers can help you, contact bankruptcy attorneys at Kingcade & Garcia today.