Bankruptcy...

Ft Lauderdale and Hollywood Florida Chapter 7 and 11 Bankruptcy Attorney

Bankruptcy is the process of relieving unmanageable debts while dividing limited assets among creditors fairly. Our bankruptcy law is rooted in the original Constitution (Article I, Sec. 8). The current Bankruptcy Code was passed in 1978 and has been revised significantly four times, most recently, and most dramatically, in 2005.

Types of bankruptcy

There are five different types of bankruptcies, called by the chapter in bankruptcy law (Title 11 of the United States Code)

• Chapter 7
• Chapter 9
• Chapter 11
• Chapter 12
• Chapter 13

Most individuals file for Chapters 7 or 13.

Bankruptcy Chapter 7 is the fastest, least expensive, and most popular Chapter. An individual fills out paperwork which discloses assets, exemptions, liabilities and recent financial history in great detail. Exemptions are the property that one is permitted to retain through a bankruptcy. The papers are filed with the Clerk of the Bankruptcy Court, who sends a notice to all listed creditors.

About 40 days after the case is filed, there is a meeting with the Bankruptcy Trustee. All creditors are invited to attend the meeting. If there are no objections or complications, a discharge is issued after 60 days following the meeting with the Trustee. Discharge means that your debts (with some exceptions) are wiped out, forever.

Bankruptcy Chapter 13 is a payment plan requiring payments to a bankruptcy trustee over a period of 3 to 5 years. By making 36 to 60 payments, an individual can catch up on defaulted mortgages, loans, or leases. Or, an individual may pay the value of assets which might have been taken by a bankruptcy trustee in a Chapter 7 case. If your household income exceeds certain guidelines, Chapter 13 may be your only practical choice.

Bankruptcy Chapter 12 is a type of reorganization only available to farmers and fisherman.

Bankruptcy Chapter 11 is generally used by companies (although it is available to individuals) to reorganize complex debts or assets— i.e. Delta, Kmart, Toys R Us, Enron.

Bankruptcy Chapter 9 is for municipalities (Orange County, California)

The official explanation of the chapters is available online.