Chapter 7 Bankruptcy Miami
Introduction to Chapter 7 Bankruptcy in the United States
Presently, the United States has been experiencing an economic crisis which has resulted in the loss of employment and the difficulty of handling large debts. Many individuals simply do not know how to manage their earnings and have gotten into uncontrollable debt.
Six types of bankruptcy were developed in USA since 1978, but the most common ones are really under Chapters 7, 11, 12, and 13. Chapter 7 is also known as debt settlement, Chapter 11 a reorganization of bankruptcy, chapter 13 is a strategy payment plan called “wage earner”, and Chapter 12 meets the same requirements as Chapter 13 but is aimed only at those debtors who are engaged in agriculture and fishing. You can find more details about Chapter 13 in the section of bankruptcy.
People usually think that bankruptcy is exhausting and can destroy the credit, but the truth is very different. If you feel suffocated with so much debt, you should consider filing for bankruptcy and Chapter 7 is the best way. Chapter 7 allows debtors to keep their properties, get rid of all debts, and even achieve their desired credit score. (See more information about credit on our website and the procedure to obtain the credit after bankruptcy).
History of Bankruptcy Law
Bankruptcy dates as back as the 1800s. It’s during this time that the U.S. Congress approved the first bankruptcy law. Apparently, only traders were allowed to file for bankruptcy back then. Debtors were able to file for bankruptcy about a half year earlier. It was mandatory to fulfill the requirements included in this law. For almost half a century after instituting this law, there was no federal bankruptcy law in the U.S. and creditors processed the properties of debtor in his or her respective state. This caused an economic crisis in the 1840s and “Federal Bankruptcy Code “law emerged, which helped merchants, and anyone struggling financially because they owed large amounts of money. They now had the opportunity to go voluntarily bankrupt. However, in 1843 the law was annulled. This happened because creditors were not happy with it. Then the third bankruptcy law emerged after the Civil War. This law continued with the precedent that both merchants and non-merchants could freely file bankruptcy. In 1874, the only way to file for bankruptcy was for the individual to have committed constituted bankruptcy law acts, except the debtors had around 30 percent or less of payables. A reform in which debtors and creditors could understand each other on a judicial commission was also established in 1874. In 1878, the bankruptcy law initially passed in 1867 vanished and in 1898, the new bankruptcy law, which is in force today, was established and the first reforms on chapters 7, 11, and 13 emerged.
The first changes to the bankruptcy law was established in 1898 took place in 1978. Some administrative guidelines were modified. One of the most common bankruptcies across the nation was Chapter7. Some chapters were combined. For example, Chapter 10 and 11 became 11.
In 2005, the BAPCPA or “Bankruptcy Abuse Prevention and Consumer Protection Act” emerged. With this law now borrowers had to prove how they were unable to cover their debts. They also had to attend classes about economy and credit. Chapter 7 bankruptcy appears under the federal law, Title 11 of the U.S. congress. Bankruptcy is a legal right under the Constitution of the United States. These processes are led by judges who specialize in this particular area.
What is chapter 7 Bankruptcy Miami?
Chapter 7 bankruptcy, also called “Liquidation or Discharged”, is a legal process under U.S. federal law that was established for companies and individuals with properties. Its main goal is the elimination of all debts that were acquired in a period of time. Obtaining a chapter 7 bankruptcy discharge means that people can continue with their lives without worrying about financial debts since they will be canceled in the bankruptcy process.
Requirements to establish Bankruptcy under Chapter 7
Chapter 7 bankruptcy can only be filed by individuals and by some types of business debtors meeting the following requirements:
- Have low and stable income.
- Struggle to pay the bills each month.
- Be sure debts will take at least a period of 5 years to be paid.
- Have not filed a Chapter 7 bankruptcy in the last five years.
Advantages of Chapter 7 Bankruptcy
Filing for bankruptcy can contribute to the individual’s immediate relief from collection activity. Chapter 7 bankruptcy Miami provides the following:
- No payments to creditors.
- Eliminates overwhelming debts such as credit cards debts, bank loans, medical bills and so on.
- Creditors must cease any type of actions against debtors.
- Foreclosures are cancelled and the properties are retrieved. Individuals are able to keep cars, house and other personal belongings.
- The credit can be rebuilt in less time than any other bankruptcy chapter.
How does Bankruptcy Work? Process of Bankruptcy under Chapter 7
The process of bankruptcy under Chapter 7 is fairly quick; in just two months the debtors will be enjoying the first advantages of Chapter 7. First, the debtor must meet with one of our qualified attorneys for bankruptcy, who will decide if the individual meets the requirements to file bankruptcy under Chapter 7. The process begins when the debtor fills out the form which is called “Statement of Financial Affairs “, and issues a report on the expenses, income, debts and any information about the creditors.
From the time the bankruptcy lawyer presents the case in federal court where it is carefully analyzed to check eligibility for Chapter 7. After the application, the judge informs the creditors of bankrupt property and they are forced to stop debt collection attempts. then, the trustee is responsible for collecting all non-exempt assets; non- exempt properties include a second car, a second home, and investments.
These properties are sold by the bankruptcy committee in Miami and the money goes to the creditors. The debtors have to appear in court where they have to confirm all the information previously provided. Then the creditors and the court agree and accept the Chapter 7 bankruptcy in Miami, waiving off all debts.
Bankruptcy Attorney Miami
The bankruptcy lawyers play an important role in the process of financial crisis in Miami. Miami bankruptcy attorneys will help you recover your finances. It is important to work from the start with bankruptcy attorney because he know the laws of Florida and can help an individual restore his/her economy in the shortest time possible by reducing debt and avoiding the harassment of creditors.