1. WHO CAN FILE FOR BANKRUPTCY?
Any person who resides, does business, OR has property in the U.S. can file bankruptcy. There is no requirement that a person who resides here prove their legal status – so yes, undocumented workers can file bankruptcy as well. The big/main requirement is that you pass the “means test” for filing a Chapter 7 bankruptcy. That means that the bankruptcy filer must show that he or she makes under the median income of the state (In Florida that’s right around $51,000) OR prove that he or she has under $215 in disposable income.
2. WHAT DEBTS ARE NOT DISCHARGEABLE IN BANKRUPTCY?
- Most tax debts
- Debts for fraud or theft
- Child support/Alimony
- Debts not listed on the Petition
- Debts for intentional injury or DUI
3. HOW MUCH DOES IT COST TO FILE FOR BANKRUPTCY?
Here in Florida, the filing fee is $335. Sometimes the Court will waive the fee if you can show hardship.
4. WHERE MUST I FILE MY BANKRUPTCY?
Bankruptcy petitions are filed in the District Court of the location you have lived the most for the 6 months.
5. WHEN IS THE BEST TIME TO FILE BANKRUPTCY?
First, don’t file until all major debts have actually been incurred. If you are in the hospital, you should wait until insurance pays and until a final bill is sent to you.
Don’t file until you’ve received all non-exempt assets (such as personal injury awards and tax refunds) because otherwise the settlement or refund will have to be turned over to the trustee.
How does bankruptcy affect my credit rating?
A bankruptcy will negatively affect your rating. However, if you are considering bankruptcy, it is likely already very bad. In that case, bankruptcy will lead you to a better rating a couple years down the road than if you don’t file.
6. DO I HAVE TO GO TO BANKRUPTCY COURT?
Not usually. The required appearance is at what is called the “meeting of creditors.” This usually happens 1-2 months after the petition is filed. You must present yourself in front of the trustee who can ask you questions under oath about your assets. Also, creditors can also appear and ask you questions in order to ascertain if you have any assets that are not exempt that they can take in order to pay creditors.
7. DOES MY BANKRUPTCY AFFECT CREDIT IF I AM A CO-SIGNOR?
No, the discharge only removes your obligations. It does not affect any of your co-debtors obligations.
8. WHAT DOES A BANKRUPTCY LAWYER DO?
- Analyze a person’s debt situation and whether bankruptcy is the best option for a person -and when.
- Assist client in obtaining pre-bankruptcy classes.
- Gather information in order to prepare the Petition.
- Assist the client in arranging his assets in order to keep as much as possible.
- File the Petition.
- Assist client with reaffirming debts.
- Prepare and attend the meeting of creditors with client.
- Prepare pleadings or amend filings as necessary.