Bankruptcy Explained Simply
While it may be true that the Sunshine state is much more widely known for its immensely popular amusement parks, its brilliantly warm weather, sandy beaches, its plethora of wild animals including alligators, and of course its sunshine, there is a lot about Florida that the average American even Floridians may not know. One of the maybe surprising facts about Florida is that the state’s economy is one of the fastest-growing in all of the country. In fact, when compared to the other most populated states, the gross domestic product of the Sunshine state has grown fast since 2016 that it has even surpassed California and Texas. However, despite a healthy economy, Florida is also home to many, many people who suffer and struggle with debt. More and more Floridians are considering bankruptcy to get a fresh start, this article will help you understand bankruptcy explained simply.
With so many struggling to keep up with their debt, many in Florida find themselves turning to bankruptcy for help. With everything happening over the last year, there will no doubt be even more people dealing with difficult financial situations and looking for all of their best options to get help. There is a fundamental mischaracterization of bankruptcy out there that sees it as a matter of federal law, and that all bankruptcy cases are the same. None of this is true. In fact, filings from state to state will be held to different rulings and guidelines. Though, there are some federal oversights in some states. When it comes to filing for bankruptcy, doing so as a Florida resident is actually one of the most simple processes out there thanks to the Sunshine State’s generous bankruptcy laws. While there are different types of bankruptcy that depend on your specific situation, the most important thing to keep in mind when dealing with filings is what kind of exemptions are available to you as a Floridian. The following are some simple explanations of what kind of exemptions you can look for as a resident of Florida.
Do not automatically rely on Florida bankruptcy laws
Just because you live in Florida, this does not mean that you can automatically rely on having Florida bankruptcy laws applied to your case. While it is true that your choice of exemption laws is determined by your state of residence, there are some factors that come into play when determining this. For instance, in order to have Florida exceptions, you will have had to live in Florida for two years prior to filing in order for the laws of the Sunshine state to apply to your own case. The reason these residency requirements have been put into place is to help stop debtors from doing what is known as forum shopping, which involves moving between states in order to find the most favorable exemption laws that fit your specific circumstances. So, if you have not been a resident of Florida for two years prior to filing, your case will be held accountable to the exemption rules of the state that you had spent the most time in during a 180-day period before the two-year look-back window.
Florida Homestead Bankruptcy Exemption Protection information
If you have been a Florida resident for two or more years, you can rest assured that Florida bankruptcy laws will be able to be applied to your bankruptcy filings. So, you need to know what you can expect when it comes to filing. The first thing you need to know about bankruptcy in Florida is that the Sunshine state is what is known as an “opt-out state.” This means that the federally offered exemptions are not applicable here. While this may sound costly to you, it does not actually make a significant difference in typical cases because Florida does have some very generous exemption laws of its own. In fact, they are so generous that there are countless cases of celebrities who flock to Florida in order to take advantage of the unlimited homestead exemption that is available here.
While the constitution of Florida does grant all Floridians access to unlimited homestead protection from judgment creditors, no matter how long they have lived here or not. The bankruptcy system works slightly differently. When filing for bankruptcy in Florida, the homestead exemption allows a debtor’s primary residence of unlimited value safe haven from creditors, but only if the debtor has been a Florida resident for 40-plus months prior to filing and the property fits within the size restrictions depending on the municipality. However, if the 40-month residency has not been met when filing for bankruptcy in Florida, the homestead exemption has a cap of $160,375, as guaranteed by federal laws.
More exemptions and bankruptcy information
If you need information on more of the popular or even lesser-known Florida bankruptcy exemptions, contact a qualified Florida bankruptcy attorney. This can be especially useful because the amounts available through exemptions do change periodically.