Demystifying the Bankruptcy Process-Part 1
Many clients and prospective clients contact us and ask common questions based on advice from their relatives or a “friend of a friend.” These blog entries will dispel common myths and educate you on the general process of bankruptcy in Florida.
QUESTION: Will I lose my Home if I file Bankruptcy in Florida?
There are two types of consumer bankruptcy: Chapter 7 (Liquidation) and Chapter 13 (Reorganization for Wage Earners). One of the benefits of consumer bankruptcy is that it allows extraordinary relief that cannot be accomplished outside of bankruptcy.
Chapter 7 Bankruptcy
First, Florida allows an unlimited exemption for your homestead property which allows you to protect from creditor (and Bankruptcy Trustee) claims. Simply put, if you file Chapter 7 bankruptcy in Florida and you are current on your mortgage payments, you will not lose your home. Additionally, filing Chapter 7 Bankruptcy or any type bankruptcy will trigger the automatic stay. The automatic stay ceases all collection action on your debts, including without limitation, stopping collection on judgments and cancelling scheduled foreclosure sales.
Chapter 13 Bankruptcy
If you are behind on your mortgage and you desire to stay in your home, Chapter 13 Bankruptcy is an excellent option. The Judges in the Bankruptcy Court, Southern District of Florida (which covers from Vero Beach (north) to Key West (south) and all points in between, including West Palm Beach, Fort Lauderdale and Miami) have established the MMM Mediation Program which allows our clients to seek a loan modification inside of bankruptcy. The program has existed for almost one year and our clients have experienced great results. For more information, please contact the experienced bankruptcy attorneys at The Wallace Law Group with a convenient office location in Boynton Beach representing clients in Boynton Beach, Delray Beach, Boca Raton, West Palm Beach, Greenacres, Wellington, Fort Lauderdale, Coral Springs, Deerfield Beach, Parkland, Hollywood, Weston, Aventura, Miami, Miami Beach.