Kingcade & Garcia, P.A.
Set Up a FREE In-Office Consultation
Open Every Saturday Morning 8 AM to 11 AM.

Miami Bankruptcy Law Blog

Can a creditor freeze your bank account?

It is very easy to get into debt in Florida. Anyone can overspend or over extend themselves. However, once your debt becomes problematic and you can no longer make your payments, some creditors may take drastic steps. You may be concerned about the security of your bank accounts in such a situation. Typically, for secured debts, you do not have much to worry about because they take whatever it is that secured the loan, such as your home or car. However, for unsecured debts, creditors may very well go after your bank accounts.

The good news, according to Zacks, is a court order is required before a bank account garnishment actually occurs and you get a notice of this. Before the any money is taken, your account is frozen, which means you cannot access the funds in it. This gives you a chance to object. You should note the freeze only includes funds up to the amount owed, so if you have more funds in your account than owed, you will have access to them. In addition, some funds are exempt from garnishment, such as Social Security. Some other benefits, such as veterans, retirement or disability, may also be exempt. If it is a joint account, only half the funds can be frozen or taken. 

What is the Making Home Affordable Program?

The real estate market went through some terrible times in the early 2000s across Florida. It put many people's home in jeopardy of being foreclosed. According to the U.S. Department of the Treasury, the government created a program called the Making Home Affordable Program to help you out if you faced foreclosure. It was specifically designed to help you avoid losing your home and to assist you with getting back on your feet when you got into a bad financial situation.

Created under the Obama Administration, the MHA featured the Home Affordable Modification Program. The HAMP helped to reduce or modify mortgage payments to make them affordable for you. Under the MHA, you also could get help with a short sale of your home, forbearance of your loan payments and refinancing. You also may have qualified for a deed-in-lieu of foreclosure. The program worked by considering your specific situation and tailoring a solution that met your needs. It offered help so you could keep your home or get out of homeownership. It was quite helpful if you were unemployed or owed more than your home was worth on your mortgage.

What is the means test?

When you hear about bankruptcy in Florida, one of the main things brought up is the means test. This is a very important aspect of qualifying to file for bankruptcy. It is a two part test that takes a look at your income and expenses to determine which type of bankruptcy you can file, according to Nerd Wallet.

The first part of the means test looks at your income. You will need to report and show documentation for all earnings, business income and other income. It does look at the past six months, but if there has been a recent change, that is taken into consideration. Your median income is compared to a set income amount based on the average median income. If your income is below that, then you pass the means test and do not need to do part two. You are allowed to file Chapter 7 bankruptcy.

Why are credit cards bad for your credit?

You probably have at least one credit card in your wallet. Having an emergency credit card that is only used for situations where you need extra money but do not have it, such as a car repair, and which you pay off in full when the bill comes is a good use of a credit card. This is not how most people use them, though. According to Time, credit cards are a dangerous option for most people.

The issue is most borrowers do not pay off their bill in full when it comes, which is considered the responsible way to use credit cards. Instead, they keep charging and make the minimum payment. This leads to astronomical costs in the long term. The average amount of credit card debt for people between the ages of 18 and 65 is $4,717.

Can I keep my auto loan if I file bankruptcy?

If you are thinking about filing for bankruptcy in Florida, you may have many questions. One of those may be what will happen with your vehicle loan. If you do not own your vehicle, how is that handled when you file? Will you lose it? Can it be left out of the bankruptcy?

According to BankRate, regardless of whether you wish to continue paying on a debt or not, it must be included when you file Chapter 7 bankruptcy. It can be listed as a debt in your filing paperwork with the indication that it is not to be discharged as part of the bankruptcy. However, for the purposes of your credit, it will be reported that the loan was part of your bankruptcy.

Bankruptcy myths revealed

When facing financial troubles, many people look to bankruptcy. This is a complicated legal process that can often be confusing. People may have many ideas about filing bankruptcy in Florida that simply are not true. These myths seem to be quite persistent, and if people are to get the most benefit from the process, they need to separate the facts from the myths.

Time notes many people believe that paying off their debts is a much better alternative to bankruptcy in every situation. However, this is not true. There are many situations where paying off the debts could do more harm than good. Some people may try to pay off debts because they fear they will lose everything if they file. This is another myth. You are allowed to keep most personal items and many other large items under exemption laws. In addition, usually only things that can be sold off for a profit will be taken so they can be used to pay back creditors.

Bankruptcy and credit scores

Bankruptcy and credit scores

Florida residents contemplating bankruptcy as a last resort for obtaining debt relief may have concerns about how filing for bankruptcy will affect their credit score and credit report. As explains, a Chapter 7 bankruptcy can stay on a credit report for as long as 10 years from the date it is filed, although the discharged debts will disappear about seven years after their activity ceases. A Chapter 13 bankruptcy stays on for seven years from its date of filing or 10 years if the bankruptcy is not completed or discharged.

Should you file for bankruptcy?

More and more, it seems like bankruptcy is becoming a much more attractive option for those in Miami that are in desperate need of debt relief. This assumption is no doubt in response to the high number of personal bankruptcy filings seen in recent years. Indeed, data shared by the United States Courts shows that there were 793,932 non-business bankruptcy filings in 2016 alone. In many cases, bankruptcy may be one's best option. Yet is it for you? 

As you sit mired in debt, having many of your liabilities discharged may seem like a welcome blessing. Yet keep in mind that you must qualify for a debt discharge through a Chapter 7 case. If you do not, you will still have to repay many of those debts if you choose to file under Chapter 13; the only difference is that they will be repaid over an extended period of time. 

The benefits of foreclosure mediation

While you may do everything possible to stay on top of finances and avoid unnecessary debt in Florida, the need to foreclose on a home can strike anyone. This decision can be heart-wrenching, but there are things you can do to lessen the stress and possibly avoid foreclosure altogether. We at Kingcade Garcia McMaken can guide you through one of these options, foreclosure mediation, to ensure that you get the best possible arrangement for your situation.

According to, most lenders want to find a way to work with you on your home loan. By engaging in the mediation process, you can create new terms and payment plans that you may be able to better afford. Another perk of using this process is that the foreclosure activities will be suspended until you complete the mediation.

Common bankruptcy myths, debunked

If you are considering filing for bankruptcy in Florida, you may have a lot of questions about how the process works, what types of debts you might be able to eliminate and how it might affect your credit, among related concerns. When it comes to bankruptcy, however, there is a lot of misinformation out there, and learning how to separate fact from fiction can help you decide whether filing is the right choice for you. At Kingcade Garcia McMaken, we have a firm understanding of how bankruptcy works, and we have helped countless clients navigate through the process and regain control over their finances.

A common misconception about filing for bankruptcy, per Time, is that there is a certain stigma associated with doing so, or that by doing so, you are admitting to not being able to effectively manage your finances on your own. If you feel this way, remind yourself that bankruptcy exists for a reason, and that many people from all walks of life rely on it at some point. Furthermore, you may count yourself among the large percentage of people who file because of mounting medical bills, which is something you might have little, if any, control over.

Set Up A Free, In-Office Consultation

Open Every Saturday Morning 8 AM to 11 AM.

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy


Firm Location

Kingcade Garcia McMaken
Miami, FL 33145

Miami Law Office

Firm Number
Review Us