Miami, Florida Consumer Bankruptcy Lawyers

The differences between Chapter 7 and Chapter 13 bankruptcy begin with a means test. In order to file under Chapter 7, your family income cannot exceed the Florida median income for families of a similar size. If you qualify for Chapter 7 bankruptcy, you can discharge unpaid credit cards, medical bills, certain kinds of loans, and other forms of unsecured debt.

If your income is too high, you can file for bankruptcy under Chapter 13. Under Chapter 13, your debt will be restructured in order to allow you to pay off a percentage of what you owe over a 3 or 5 year period. In both instances, once the court approves your bankruptcy plan, there is very little creditors can do to force you to pay late fees, fines, or harass you as long as you stay current in your payments to the trustee.

At the law office of Kingcade & Garcia, our attorneys prepare and file all necessary paperwork related to bankruptcy. If you are unable to make your monthly mortgage payment and stay current other bills, contact bankruptcy attorneys at Kingcade & Garcia today to schedule a free consultation.

Home Foreclosure - The Difference between Chapter 7 and Chapter 13

Chapter 7 Bankruptcy

While filing for Chapter 7 will temporarily halt foreclosure actions, banks can still file for stay of relief, enabling them to foreclose on your home if it is clear that you will not be able to bring your past-due mortgage current and continue your other payments. Once your credit card and unsecured debt is discharged, you may have enough monthly disposal income to make your mortgage payment. If you had fallen behind in you payments, most lenders would probably require you to bring the mortgage current; if you can't do this, they will probably file a foreclosure as soon as your bankruptcy is closed.

Chapter 13 Bankruptcy

Under Chapter 13, past-due mortgage payments can be rolled into your repayment plan. However, Chapter 13 repayment plans do not allow you to reduce your monthly mortgage payment. If you want to reduce your monthly mortgage payment you'll need to negotiate a loan modification with your bank. Even so, past-due mortgage payments can be included in your repayment plan so long as you are able to continue making your monthly mortgage payment. Chapter 13 also allows you to discharge a percentage of your unsecured debt (credit card), and that reduction of your total debt load may allow you regain you stability with your mortgage payment.

Personal Property - Chapter 7 and Chapter 13 Bankruptcy

Another important difference between Chapter 7 and Chapter 13 bankruptcy is how certain items of personal property are handled. In Chapter 7 bankruptcy, the court can seize and liquidate some of your personal property in order to pay your creditors a portion - or all - of what you owe them. Typically, luxury items like plasma screen TVs, expensive appliances, high-end electronic equipment, or expensive cars are targeted. In Chapter 13 bankruptcy, since you are required to pay a portion of your debt through a repayment plan, you may be able to avoid having your property seized or liquidated.

Questions? Contact Bankruptcy Attorneys at Kingcade & Garcia Today

If you are thinking of filing for bankruptcy, contact bankruptcy lawyers Kingcade & Garcia today to schedule a free consultation and learn how we can help you.