There are many people with little information about bankruptcy currently in the United States, so they believe that this can be overwhelming and can even destroy their credit, but the truth is very different. If you feel drowning in debts and not knowing how to resolve the situation, you should consider the fact that filing bankruptcy is the best solution to solve your financial difficulties. The bankruptcy process is the perfect solution to improve financial distress and debts incurred by many people. The different types of bankruptcy are established under federal law in the judicial courts of the state according to the case and they are aimed at the total cancellation of debts.
Since 1978 six (6) types of bankruptcy were developed in USA, but the most common are really under Chapters 7, 11, 12 and 13. Chapter 7 is also known as debt settlement, Chapter 11 a reorganization bankruptcy , Chapter 13 is a strategy payment plan called acquired wages and Chapter 12 meets the same requirements as Chapter 13 but is entitled to those debtors who are engaged in agriculture and fishing.
The current Bankruptcy Code has been amended several times since 1978. Within the amendments the act prohibits the employment discrimination against those who have declared bankruptcy. (See more information about credit on our website detailing the steps to achieve the credit after bankruptcy).
Bankruptcy process Miami can be a difficult process through which companies as well as individuals can eliminate their debts and the bankruptcy court will defend them. The concept of bankruptcy may get quite large and has had great impact in the history of USA. In the year 1980, 300.000 people filed bankruptcy; in 1990 this value was significantly increased by half, 600.000 people and companies went bankrupt. Since 2006 the values were increasing more and more to the point that 2 million people were declared in bankrupt. According to several studies performed, people with uncontrollable debts are those:
The term bankruptcy in the United States has its beginnings in the 1800s, where the U.S. Congress passed the first law on bankruptcy. Traders were the only ones authorized to file bankruptcy. No one else could voluntarily become bankruptcy debtor. Debtors could only establish bankruptcy six months in advance and were obliged to meet one of the acts covered in the bankruptcy law. For 40 years after the establishment of the law the United States had no federal bankruptcy legislation and material assets of the debtors were handled by creditors (creditor is a person or institution that extends credit by giving borrowed money to be paid later) on insolvency laws depending on the state where the case arose. Due to this situation, the United States suffered an economic crisis, so in 1841 a new law called “Federal Bankruptcy Code,” which origins were rooted on British law, was established. This law not only benefited merchants but also those with large financial debts. This law was nullified in 1843 due to the continuous attacks of creditors who did not agree with the law.
After the Civil War in 1867, the third law on bankruptcy emerged, this continued the criteria that any merchant and non-merchant had the right to voluntarily file bankruptcy. In 1874 it was established that to declare bankruptcy an individual had to commit some actions constituted in the bankruptcy law, unless the properties of the debtors were below 30 percent of payables. In the same year the reform that debtors could be understood with creditors on a debt within a judicial commission emanated. In 1878, the bankruptcy law established in 1867 disappeared. The Bankruptcy Act of 1898 also known as Nelson Act was the first United States Act of Congress that gave the companies an option of being protected from creditors.
The Bankruptcy Reform Act of 1978, referred to as the Bankruptcy Code, completely replaced the former Bankruptcy Act of 1898, where the administrative guidelines of the case occur amended. Chapter 7 appears as the most common form of bankruptcy throughout the United States and also combines 10 and 11 that becomes 11.
In 2005, further reforms on bankruptcy law called Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) reappeared. This law establishes that borrowers must demonstrate complete inability to pay their debts that information will be verified in more detail and the individuals will have to attend courses on credit and economy. This prevents debtor’s abuse on eliminating debts with Chapter 7.
The bankruptcy process is codified under federal law in Title 113 of the Congress of the United States. The Constitution states in Article No. 1 that bankruptcy is a legal right of all American citizens residing in any state within the USA. Bankruptcies are run by specialized bankruptcy judges belonging to the committees of bankruptcies in the corresponding Federal District.
There are several important chapters often used by most of the people or institutions with economic difficulties. Chapters 7, 11 and 13 are going to be used depending on several factors such as the income of every individual, debts, assets, accounts to pay and the goals the debtor would like to reach by filing the bankruptcy.
Anyone with serious financial difficulties can file bankruptcy, but there are certain precautions that the debtor must have in mind when going bankrupt, including:
The bankruptcy process is a complex but powerful tool if carried out with the help of a good bankruptcy attorney. Firstly, you must contact our office where our bankruptcy lawyers at Gallardo can advise you through the process to achieve the desired objectives. A report of your assets, income, debts and any additional information about your creditors are then obtained. The lawyer will determine the best type of bankruptcy that corresponds according to your specific financial situation, it is to say, Chapter 7, 11 or 13 bankruptcy. From this time, the Miami bankruptcy lawyer presents the case in federal district court, where it is deeply evaluated to be sure you are eligible for the type of chapter presented.
If the type of bankruptcy is Chapter 7 or 13, the debtor must also file a report to show that advice of using credits to be eligible to declare bankruptcy was received. Then, the debtor must appear at a meeting known as 341 and answer questions from a team of lenders in Florida. Depending on the type of bankruptcy that is filed, the debtor may have to appear before the bankruptcy judge. At the end, the judge will issue an order saying your debt has been discharged (under Chapter 7) or grant you the repayment plan (under Chapter 13).
Filing for bankruptcy can bring some important consequences that debtors should consider such as:
The process can provide a number of benefits and relief to debtors, including but not limited to: the avoidance of harassing telephone calls, letters, and even lawsuits from creditor; it forces creditors to terminate any action against the debtor such as foreclosures, evictions, and repossessions. Bankruptcy allows the possibility to keep certain categories of property which had been acquired previously. In addition, it grants debtors a fresh start. Filing Chapter 7 and 13 bankruptcies serves to cancel debts such as credit cards and other personal debts.
Bankruptcy laws have been designed to help individuals in their financial crisis. A bankruptcy attorney can help you to better navigate the whole bankruptcy process from start to finish. You can recover your finances and move forward to a more financially stable future with the legal assistance from a respectable firm such as Gallardo law Firm. There are many choices you can make depending on your particular situation. Your current financial situation can be restored faster with the help of a qualified lawyer. Lawyers understand more bankruptcy laws in Florida and they know all the legal options available for you and which type of bankruptcy is more beneficial for you. Hiring an experienced attorney is a good investment as it will save you time and money in the long run.