Florida Bankruptcy Laws

If you are considering filing for bankruptcy in Florida, it’s important that you understand the law as it pertains to your particular situation. Here are some of the most important Florida bankruptcy laws to consider.

Filing for bankruptcy in Florida is an option if you are having trouble paying your debts on time. Bankruptcy allows borrowers to stop any collection efforts and gets a fresh start right away. After filing for bankruptcy, all phone calls, wage garnishments, and foreclosure sales must cease immediately. Bankruptcy allows people to get rid of their debts and gives them the chance to start over. Although filing for bankruptcy in Florida can provide many benefits, it may not be right for everyone. If you are thinking about bankruptcy, contact Bruner Wright P.A. to arrange a consultation.

How Common Is Bankruptcy in Florida?

Bankruptcy can be more common than you might think. There were 755,185 filings of bankruptcies in the United States in 2018. According to studies, the average American has about $38,000 in debt. In June 2019, 852 bankruptcy cases were filed in Tampa alone. The number of cases filed is influenced by medical bills. The American Journal of Medicine has found that 62.1% of all bankruptcy filings can be attributed to medical reasons. The study also found that 92% had more than $5,000 in medical debt when they filed for bankruptcy.

The Three Types of Bankruptcy

Chapter 7: This type allows creditors to be repaid by selling non-exempt property. However, Chapter 7 is not for everyone. There are income requirements that you must meet.

Chapter 13: This type is a plan that will allow you to make three to five years of payments to your creditors. You should comply with the repayment plan and be allowed to keep your property.

Chapter 11: This type is different from Chapter 7 or Chapter 13 as it provides legal assistance to corporations and businesses in trouble. The company is able to continue to operate but its finances are restructured in order to maximize its repayments to creditors.

Where Can I File for Bankruptcy?

Bankruptcy can be filed in federal court. The bankruptcy process is different for businesses and individuals.

Bankruptcy Process for Individuals

For individuals, the case is filed in the district where the borrower resides. If you live in Tampa, for example, the U.S. Middle District in Florida may be filed. The most recent 180 days will determine the residence. If you have lived in multiple places within the last 180 days, your filing location should be the one where you spent the longest time.

Bankruptcy Process for Business

A business must file in the place where it is situated. The district in which the corporation is located will be its domicile. Unless a new domicile is purchased, a domicile cannot be changed. Depending on the facts of each case, however, the principal business location will vary. Many companies do business in multiple states, and many have offices throughout the country. These types of situations mean that the primary place of business is the “nerve centre” of the company. The “nerve centre” is where the corporation will make its primary business decisions within 180 days immediately prior to bankruptcy.

In cases involving business partners, the venue will be determined based on the principal place or location of the principal assets. In bankruptcy cases that are filed by partnerships, the venue is not determined on the basis of residence or domicile. Instead, bankruptcy courts will focus on the principal location or location of assets. The assets that are primarily used by the business’ operation are called principal assets. Investments may not suffice if the assets are related to the business.

Work With the Best Florida Bankruptcy Lawyers

Bankruptcy is never an easy process. Instead, it can be a long, drawn-out slog through the mud. Thankfully, however, there are ways to make this process less painful. It’s key to speak with a bankruptcy attorney who knows Florida bankruptcy laws and how to get you through it as quickly as possible. Contact Bruner Wright P.A. today!

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