If you are considering filing bankruptcy, let Attorney Charles Wynn assist you in determining the best choice for your situation. Either a Chapter 7 bankruptcy or Chapter 13 bankruptcy may be appropriate in certain scenarios. Contact Mr. Wynn today for a confidential consultation. He can help you determine which type of bankruptcy is the best one for your circumstances.
Chapter 7 Bankruptcy
Most often used when:
- Client owns little property, usually just furniture and clothing or when the assets are within the allowed state exemptions
- Client has no money left after paying basic monthly expenses, or cannot meet expenses on a monthly basis
In Chapter 7 Bankruptcy, many debts can be eliminated completely. In order for this to happen, all non-exempt assets (assets which are not protected from creditors) must be sold in order to pay back some of the debt. A common myth about Chapter 7 bankruptcy is that the filer would lose his or her home, but in truth your home is exempt if it fits within certain statutory criteria. Another myth is you are entitled to keep your car. You are not promissed a car. You are entitled to exempt, or protect, $1,000.00 of equity in a vehicle titled in your name. If your vehicle is financed, and there is no equity, you can reaffirm the debt (make a new promise to pay the debt which is approved by the Court) on the vehicle and keep it. You can keep more than one vehicle if you are current on the payments and and debt is reaffirmed. In 2005 Congress instituted a means test for Chapter 7 elligibility. The means test compares your 6 month average income with the average income for your area and if you are above the median income level, you are required to file Chapter 13 reorganization which will have a 60 month term.
Chapter 13 Bankruptcy
Most often used when:
- Client has significant equity in non-exempt assets and would like to keep them
- Client is behind on house payments and cannot cure the missed payments all at once or over a short period of time
- Client can pay living expenses and has funds available with which to pay toward debts
- Client with business investment property, where the value is less than the amount of debt, can surrender the
property and manage any deficiency under a Chapter 13 Plan
- Client with an unincorporated business (sole proprietorship) which needs the terms for its account payables
Chapter 13 bankruptcy does not eliminate debt immediately as Chapter 7 does, but requires the client to instead restructure the debt and create a repayment plan. Any unpaid unsecured debt remaining at the end of the Plan is discharged. The changes made to the Bankruptcy Law in 2005 make it more difficult to file Chapter 7 and wipeout unsecured debt if your income is above the median income for your area according to the means test. Those not passing the means test must file a Chapter 13 bankruptcy and pay a minimum payment according to the means test over 60 months. Under Chapter 13, you will make at least one monthly payment to the Chapter 13 trustee. You will not have direct contact with creditors for the entire protected period.
Consider your choices
Determining the need to file bankruptcy is one of the most difficult financial decisions one can make. It is not something to be made lightly. Attorney Charles Wynn will help you decide the best choice for you. Charles Wynn has practiced Bankruptcy since 1978 and has handled all types of bankruptcy. He will also examine your situation to determine if any non-bankruptcy alternatives are available. With over 33 years of experience with Bankruptcy in Florida, Mr. Wynn has the knowledge to guide you to the best solution for you. Contact Panama City bankruptcy attorney Charles Wynn today if you are considering filing bankruptcy in Panama City, Marianna, or anywhere else in Florida.