What Are the Requirements for Chapter 13 Bankruptcy?

If you are considering filing for chapter 13 bankruptcy in St. Petersburg, it is important to know if your situation meets the requirements for filing. Chapter 13 establishes a three-to-five-year plan in which the debtor pays back their debt in monthly installments. Many people choose chapter 13 over 7 if they want to prevent foreclosure, stop debt collection, makeup missed payments, and more. If the debtor makes their scheduled payments, at the end of their term, their applicable debt will be discharged.

Regular Income

To qualify for chapter 13 bankruptcy, the debtor must have a regular source of income as well as disposable income they can apply towards their debt repayment plan. A debtor usually completes a means test to determine how much will be repaid. Everything paid to creditors during chapter 13 has to at least equal the amount the creditor would have received through chapter 7.

Secured Assets

Many debtors in St. Petersburg who choose chapter 13 do so because they have secured assets such as a car or a home they wish to keep. If they have more equity based on their secured assets than they would be able to protect with Florida’s exemptions, then chapter 13 is often a better choice as well.

Making Up Payments Over Time

Chapter 7 liquidates assets to pay back debts when a debtor doesn’t have the money or will not likely have it in the future. Chapter 13 bankruptcy, on the other hand, reorganizes the debt and creates a repayment plan because the debtor can repay the debts, they just need more time. Therefore, those with a valuable nonexempt property are more likely to avoid chapter 7 and opt for 13.

Repayment Plan

When filing a chapter 13 bankruptcy, debtors in St. Petersburg must propose a repayment plan schedule that demonstrates how they will repay their debts. This plan will demonstrate how much money will go towards their monthly debt repayment amount after considering other monthly expenses. The plan will also explain how the repayments will be divided up amongst the creditors. For the most part, priority claims are paid in full while unsecured claims are paid in part.

Contact Berkowitz & Myer for Chapter 13 Bankruptcy Assistance

If you are considering filing for chapter 13 bankruptcy in the St. Petersburg area, contact the law firm of Berkowitz & Myer. Our attorneys have the education and experience to help debtors through this complicated process. To schedule a consultation with a professional, call us today at (727) 344-0123 or contact us online.

How Much Does Filing for Bankruptcy in St. Petersburg Cost?

Debtors who are considering filing for bankruptcy in St. Petersburg area already facing financial concerns, and may be worried about how much the process will cost. There are various application and administrative fees necessary if you want to pursue chapter 7 or chapter 13 bankruptcy. These expenses may include credit counseling, debt management education, professional assistance, filing fees, and procedural expenses.

Mandatory Pre-Filing Credit Counseling

Before filing for bankruptcy in St. Petersburg, you have to attend mandatory pre-filing credit counseling. After completing your session, which usually lasts about 90 minutes and often can be done online or via phone, you will receive a certificate. If you file with a spouse, you must both obtain a separate certificate, but you can attend the same session. The fees for credit counseling sessions average about $50 to $75, but this can vary. It is possible to get a fee waiver or reduction before attending. The credit counselor must be court-approved, so check with the court before enrolling.

Preparation and Application Assembly Costs

When filing for bankruptcy in St. Petersburg, you will have to fill out many forms that provide details regarding your income, debts, assets, expenses, collateral, and more. Printing and completing this paperwork, which can amount to around 50 pages of forms, can cost about $30 if you do it yourself. However, because bankruptcy rules are so rigid, any mistakes can set you back, so many people choose to hire an attorney for assistance. This will increase your expenses, but it is worth it for the peace of mind and professional help.

Filing for Bankruptcy with the Bankruptcy Court

The fees for chapter 7 and chapter 13 differ. Chapter 7 fees include a $245 filing fee, a $46 admin charge, and a $15 trustee surcharge, equaling $306. Chapter 13 fees include a $235 filing fee and a $46 admin charge, adding up to $281.

Compulsory Debt Management Education

After filing for bankruptcy in St. Petersburg, before you can receive the discharge paper that declares you free of your debts, you have to complete a debt management course. The purpose of this course is to help debtors learn how to manage their finances and to hopefully help them avoid ending up in bankruptcy court again in the future. Check to see if you qualify for fee waivers or reductions, which can eliminate this additional cost.

Contact Berkowitz & Myer When Filing for Bankruptcy in St. Petersburg

Filing for bankruptcy in St. Petersburg can cost thousands of dollars with added fees and expenses. To make sure that you are organized, on time, and prepared, trust an attorney at Berkowitz & Myer for assistance. Call us today at (727) 344-0123 or contact us online to schedule a free consultation

Bankruptcy: Important Things to Know About Chapters 7 and 13

Bankruptcy may be intimidating for those who are not familiar with the process. But with the help of a bankruptcy attorney in St. Petersburg, you can manage your debt and get back on the right foot. People who pursue bankruptcy often do so because filing can:

  • Protect your home from foreclosure
  • Stop debt collection attempts
  • Prevent utility companies from cutting off power and water
  • Give you more time to readjust your debts

Chapter 7 discharges your debt, but this does not include student loan debt. There are unique circumstances that exist for student loan debt, but largely, you are responsible for paying it off. If the debtor or their dependents are under undue hardship, they may be able to seek a discharge for their student loan debt.

Whether you file for chapter 7 or 13, you must fill out and complete all necessary forms. Everyone who files for bankruptcy must complete the necessary forms for the federal government, which may include:

  • Voluntary Petition for Individuals Filing for Bankruptcy
  • Summary of Your Assets and Liabilities and Certain Statistical Information
  • Statement of Current Monthly Income
  • Chapter 7 Means Test Calculation
  • Chapter 13 Calculation of Your Disposable Income

Florida Bankruptcy

In Florida, residents cannot use federal exemptions, and must instead use the state’s exemptions. Potential exemptions may include:

  • Homestead exemptions
  • Certain personal property up to $1,000
  • Up to $1,000 in motor vehicle equity
  • Up to $4,000 in personal property if not using the homestead exemption
  • Certain pension and retirement funds like 401ks and Simple IRAs

Your St. Petersburg bankruptcy attorney can go over the various exemptions available and help you determine which ones are applicable to your situation.

What You Need to Know When Filing for Bankruptcy

When you file, you must submit a repayment plan detailing your debts like child support, vehicle loans, mortgages, and tax liens and how you plan to repay them. A bankruptcy attorney in St. Petersburg can help you devise a plan that allows you to comfortably pay your debts. Unsecured debts, like medical bills and credit cards, must be less than $336,900 and secured debt, like mortgages, must be less than $1,010,650.

Filing for bankruptcy will leave a lasting impact on your credit; it will stay on your record for ten years. This can influence your ability to loan a car, rent a home, get a credit card, and more.

To speak with a bankruptcy attorney in the St. Petersburg area, trust Berkowitz & Myer. Call us today at (727) 344-0123 or contact us online to schedule a no-cost consultation.

How Does Chapter 13 Bankruptcy Affect Your Credit?

You may be interested in utilizing Chapter 13 bankruptcy to get out from under your debt, but perhaps you have been concerned with the effect bankruptcy might have on your credit. That is an understandable concern, but it is important to remember that in many cases, the benefits of filing for Chapter 13 far outweigh the negative impact on your credit report. In addition, as people who are considering Chapter 13 are already in financial trouble, Chapter 13 will ultimately improve their credit score—even though the bankruptcy will typically appear on their report for 7 years. To learn whether Chapter 13 can help you, contact our office today to speak with a St. Petersburg Chapter 13 attorney

Bankruptcy’s Impact on the Credit Score and Credit Report

Almost every consumer in the United States has a credit score and corresponding credit report. Your credit score is a number based on your creditworthiness. A lender may use a credit score to determine whether to loan you money. Some of the loans typically take into account your credit score include the following:

  • Credit cards
  • Mortgages
  • Auto loans
  • Personal loans
  • Business loans

A credit report keeps track of your credit history, so that potential lenders may see what kind of credit you already have available and if there has been any delinquency.

The credit score is a calculation that takes into account many factors, with bankruptcy filings being only one factor among many that will affect the credit score. Therefore, you cannot know in advance the exact effect on the credit score that filing a Chapter 13 bankruptcy will have. What is known is that many people contemplating a Chapter 13 bankruptcy will already have poor credit due to missed payments and default. A Chapter 13 bankruptcy will reorganize the debt, and successful plans will bring the debt out of default. Getting credit back on track by making timely payments will have a positive impact on your credit score, particularly over long periods of time.

Obtaining Credit After Bankruptcy

It is true that a Chapter 13 bankruptcy filing can remain on a credit report for seven from date of filing. Some Chapter 13 filers have been able to obtain new lines of credit within one to three years from the date of filing. For instance, filers interested in purchasing a new home can qualify for a Fair Housing Administration mortgage after having made at least twelve on-time payments under a Chapter 13 bankruptcy plan. This is known as a “seasoning requirement.” Fannie Mae, the nation’s largest mortgage lender, has a two-year seasoning requirement. While many people believe that filing bankruptcy dooms a person to never qualifying for credit again, this is simply untrue.

A Lender’s Perspective on Chapter 13 Bankruptcy

A lender, in determining whether to extend new credit to a consumer, will review the person’s credit report and credit score. If you are delinquent on multiple accounts, you will appear to be a poor credit candidate. A lender will rightfully be concerned that if you are not paying other debts, that you will also not pay this new debt. A Chapter 13 bankruptcy, on the other hand, will demonstrate to lenders that you have the ability to make payments on all debts and you are making an honest effort to do so. After the completion of a Chapter 13 bankruptcy plan lenders may also view you as less of a risk because some or all of the debt was repaid, rather than liquidated.

Call Us Today to Speak with a Chapter 13 Bankruptcy Lawyer in St. Petersburg

Chapter 13 bankruptcy is a great tool to get your credit back on track. The attorneys at Berkowitz and Myer will advise you on whether filing a Chapter 13 bankruptcy is right for you. To find out whether you are a good candidate for Chapter 13 bankruptcy, call the St. Petersburg firm of Berkowitz & Myer at (727) 344-0123 today for a no cost, no-obligation consultation. You can also send us an email through our online contact form.

Does Chapter 13 Bankruptcy Stop Wage Garnishment?

If you are facing wage garnishment, you understand how difficult it can be to make ends meet while losing a portion of your paycheck to a creditor. It can also be very embarrassing to have your employer approached by a creditor to garnish your wages. Wage garnishment typically occurs when a creditor gets an order against you in court that permits the creditor to go directly to your employer and require your employer to withhold a portion of your pay, which ultimately gets turned over to the creditor. This makes getting out of debt that much more difficult. Fortunately, Chapter 13 bankruptcy may be able to help.

Many people use Chapter 13 bankruptcy as a means to stop wage garnishment and set up a plan to feasibly tackle the outstanding debt. Chapter 13 bankruptcy can also be used after a creditor has obtained a judgment against you but before it approaches your employer to garnish your wages. To learn more, call our office today at (727) 344-0123 to speak with a St. Petersburg Chapter 13 bankruptcy lawyer.

The Immediate Effect of Filing Chapter 13 Bankruptcy on Wage Garnishment

Immediately upon filing a Chapter 13 bankruptcy, an automatic stay is put in place that prevents any creditors or debt collectors from seeking repayment from you until the bankruptcy court lifts the stay. As a result, under the automatic stay, wage garnishment is stopped. Your attorney can provide a copy of your Chapter 13 bankruptcy petition to your employer to notify your employer that it should no longer be withholding any of your pay.

 

The Long-Term Effect of Filing Chapter 13 Bankruptcy on Wage Garnishment

In the long-term, the underlying debt that is causing the wage garnishment can be addressed in the Chapter 13 bankruptcy and repaid under terms that are more advantageous to you. Instead of losing a portion of your pay automatically, you can strategically address debt and pay it according to the Chapter 13 bankruptcy plan. Your attorney will propose a Chapter 13 bankruptcy plan that is suitable to your income so that you are not overburdened with debt payments.

Some Wage Garnishment is Not Stopped by the Automatic Stay

Unfortunately, not all types of wage garnishment can be stopped with a Chapter 13 bankruptcy. Wage garnishment due to default on Federal student loans, missed child support and alimony payments, and unpaid income tax debt cannot be stayed by filing a Chapter 13 bankruptcy. It is crucial to speak with a bankruptcy attorney at Berkowitz & Myer to determine whether your particular wage garnishment can be addressed with a Chapter 13 bankruptcy.

Call Us Today to Speak with a St. Petersburg Chapter 13 Attorney

Wage garnishment may be preventing you from catching up on your debt obligations, and if so, the attorneys at Berkowitz & Myer can assist you in filing a Chapter 13 bankruptcy to stop that wage garnishment and implement a plan to repay your debt on terms that are most suitable to you. Call the St. Petersburg law firm of Berkowitz & Myer today at (727) 344-0123 or contact us online to see if you can utilize Chapter 13 bankruptcy to stop your wage garnishment and get your finances back on track.

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