Yes, pursuant to 11 U.S.C. § 727, the debtor’s discharge may be denied in a Chapter 7 case for the following reason: (1) the debtor failed to keep or produce adequate books or financial records; (2) the debtor failed to satisfactorily explain any loss of assets; (3) the debtor committed a bankruptcy crime such as perjury; (4) the debtor failed to obey a lawful order of the bankruptcy court; or (5) there was a fraudulently transferred, concealed, or destroyed property that would have become property of the estate.

Can anyone object to my bankruptcy discharge?

Yes, there can be an objection to your bankruptcy discharge but typically this does not occur. Objections need to be for a valid reason, such as the loan or debt was incurred due to fraud or perhaps charges were made within 90 days of the filing. There can be an objection to an individual debt being discharged in bankruptcy or an objection to the entire case being discharged in bankruptcy.

What are the top reasons a bankruptcy case can be denied and dismissed?

1. You did not tell the truth.
2. You do not complete the required credit counseling courses.
3. You did not pay the bankruptcy courts filing fee.
4. You failed to attend the meeting of creditors.
5. You did not provide all the requested information to the trustee.
6. You failed to make your payments in your Chapter 13.
7. You did not file your taxes and turn over your tax refund if required.

Filing a false or misleading document could result in your bankruptcy being dismissed without you receiving a discharge, or worse, you could be charged with bankruptcy fraud and perjury if your conduct was found to be intentional, willful, or malicious. Your attorney will ensure safe passage through all the requirements of The Federal Bankruptcy Code and you will discharge your outstanding debt.

The Bankruptcy Code allows debtors to file Bankruptcy again. There are no restrictions on the number of bankruptcy cases you can file or when you can file another bankruptcy. However, the code does limit the number of bankruptcies discharges you may receive during a specified period. Filing a bankruptcy and receiving a bankruptcy discharge are two separate and distinct matters.

How long do I have to wait to file bankruptcy again?

1. The time you must wait between Chapter 13 cases is two years. 
2. If your previous bankruptcy was filed as a Chapter 7, and you want to file a Chapter 13, you must wait four years between filings to receive a bankruptcy discharge.
3. If your previous bankruptcy case was filed under Chapter 13, you must wait six years before filing a Chapter 7 case to be eligible to receive a bankruptcy discharge.
4. The time you must wait between Chapter 7 cases is eight years between Chapter 7 bankruptcy cases to be eligible for another bankruptcy discharge under Chapter 7.
5. If you were in a previous Chapter 13 that was a 100% plan, there is no waiting period to file for a Chapter 7 or 13.

Exempt assets are ones the debtors get to keep, and non-exempt assets are surrendered to the trustee? A debtor can ‘exempt” or keep certain assets by applying the appropriate statutes to the asset on the bankruptcy petition. There are numerous factors that determine what assets can be exempt. Ideally a debtor uses all the exemptions allowed by law to protect their assets. Your attorney will discuss with you what assets can be exempt and which cannot be exempt. The bankruptcy Code, local bankruptcy rules and regulations are lengthy and complicated. https://www.usbankruptcycode.org/. 

It is possible to keep all your assets. It all depends on the exemptions you claim, the outstanding loans on secured assets (i.e., car or house), what chapter you file under (7 or 13), and where our retirement is vested. If you do not claim the homestead exemption, you have the right to claim a personal property exemption of up to $6,000.00 per person. If you own more than the statute allows you to exempt, you can choose which property to protect and which to surrender. Personal property includes money held in a bank account and most tax refunds.

Do not sell or give away any of your assets.

Do not pay back or give friends or family members money. If you have given money to friends or family members within the past two years, or if you have sold or given away any assets within the past two years, please let your attorney know. You must disclose these transaction(s) or gift(s) to your attorney who will disclose them on your bankruptcy petition to the trustee. Any loss or theft of assets must be disclosed on your bankruptcy petition. 

Can I keep my personal property?

If you do not claim the homestead exemption described above, you have the right to claim a personal property exemption of up to $4,000 per person of your personal belongings.

If you own more than $4,000 worth of personal property, you can choose which property to protect. The personal property includes money held in a bank account.

Can I keep my house?

Yes. Many debtors chose to keep their homes. You can keep your home and up to one-half acre of land from if you live in an incorporated area. If you live in an unincorporated area, you homestead and keep up to 160 acres. You must be current on your mortgage if you decide to keep your home and file a Chapter 7.If you’re not current on your mortgage payments,  you may need to file a Chapter 13 and catch up the past due amount (arrearages) over 36 or 60 months. Some debtors chose to “surrender” their home, in Bankruptcy. If you surrender your home, you owe nothing to the lienholder, and they get their asset returned.

Is mortgage mediation available in bankruptcy?

Yes. Mortgage Mediation can be ordered by a Bankruptcy Judge and the lender must participate.  A Mediation may result in a reduction of your principal, your payments, and your interest. The lien holders can forgive the arrearages or offer many solutions and options to allow a debtor to keep their house. You may be able to strip your 2^nd mortgage and discharge the debt as unsecured in a Chapter 13 depending on the value of the homes.

Who can place a lien on my house?

The 1^st or 2^nd mortgage holder, your H.O.A. (Homeowners association) or anyone who loaned you money to buy, improve or repair your home. The I.R.S.

What if my home was in forbearance?

To combat ongoing misinformation, the Federal Housing Finance Agency (FHFA) stated that borrowers in forbearance with a Fannie Mae or Freddie Mac are not required to repay the missed payments in one lump sum. If the hardship was not resolved, the forbearance plan can be extended. If the hardship has been resolved, the servicer will work with the borrower to set up a repayment plan, modify the loan so the borrower’s payments are added to the end of the mortgage, or set up a modification that reduces the borrower’s monthly mortgage payment.  Read more about FHFA and CFPB’s Borrower Protection Program here.  To see the actions FHFA has taken to help Americans impacted by the coronavirus remain in their homes please visit FHFA’s Webpage on Coronavirus Actions.

What if I refuse to move from a house I have surrendered?

The circuit court will more than likely issue a writ of possession and the Sheriff’s office will serve it on you and escort you from the premises.

Can I keep my vehicle?

Yes. However, you must be current on your payments. Some debtors surrender their car, meaning they are no longer obligated to pay the debt, but they no longer have use of the car.

Can I keep my life insurance policy or annuity?

Yes, but you must continue to pay your premiums. The cash surrender value of a life insurance policy and the proceeds of an annuity contract is fully exempt. Florida Statute 222.14 exempts the cash value of a debtor’s life insurance on their own life, and the statute also exempts all types of annuities and annuity proceeds. Insurance and annuity payments remain protected after being deposited in a financial account if the funds can be accurately traced back to the exempt annuity or insurance policy. These do not have to be segregated in a separate account so long as the money in the account is traceable.

Will I be able to keep my prescribed health aides?

Any health aids used by you, or your dependents are exempt from being taken by creditors.

What happens if my name is on my elderly parent’s bank accounts?

First, do not remove your name from any bank accounts near when you file for bankruptcy protection. The Trustee may think you are trying to hide assets. If your name is on someone else’s bank account as a custodian or “just in case something happens” disclose the bank account to the trustee. 

What if I have received an inheritance or anticipate an inheritance?

Let your attorney know if you have inherited anything within the past two years or whether you anticipate an inheritance soon. If you inherit anything of value or receive life insurance proceeds within six (6) months post filing for bankruptcy you must notify the trustee and it will be part of your bankruptcy estate.

Most retirement accounts are “exempt,” meaning you keep them so long as you do not liquidate or cash out your retirement account immediately before filing bankruptcy. The following types of pensions and retirement funds are exempt in Florida:

1. ERISA qualified retirement plans and pensions including 401(k) ‘s, 403(b) ‘s.
2. Profit sharing and money purchase plans, SEP and SIMPLE IRAs, and other defined benefit plans) are fully exempt.
3. IRA’s and Roth IRAs are exempt up to $1,171,650.
4. Benefits payable under the Florida Retirement System. State and County officers and employee’s retirement system benefits.
5. Firefighter pensions.
6. Municipal police pensions.
7. Teachers’ retirement benefits.

Do not withdraw money from your 401(k) or other retirement accounts without consulting your attorney first.  Money, while it is in your 401k or other approved retirement account is exempt, meaning you keep it. If you withdraw any funds, they may not be exempt, meaning the trustee will require you to turn over the funds to be dispersed to your creditors. 

Yes. Your employment status will not affect your ability to file for bankruptcy protection. However, your income will determine what chapter you file. Some of my concerns for my self-employed clients and their business is “are there any assets associated with the business (or otherwise) that the Trustee can seize? What is the business worth? Can it be sold? What debts are my clients personally liable for versus what debts are the liability of the business? Self-employed clients or clients that have accumulated primarily business debt, should note that business debt is treated differently with respect to the “means test”. 

How do I prove my income if I am self-employed?

You must produce “profit and loss statements” for the six months before the bankruptcy filing. You will also need bank statements, both personal and business for the six months prior to filing of bankruptcy and three years of business and personal income taxes.

Where can I find information regarding the classes that must be taken both before and after filing for bankruptcy?

Information relating to pre-bankruptcy credit counseling and post-bankruptcy debtor education is found on the Program’s Web site at: Credit Counseling & Debtor Education Information. 

After your bankruptcy petition is filed, you will be required to take the 2nd Class called “Debtors Education” course online. 

After your bankruptcy petition is filed, you will need to take the 2^nd class at the same website you took the 1^st class ww.debtorcc.org. You will need your bankruptcy number to take the class.

What are the top reasons people file for bankruptcy?

1. Credit Card Debt – Chapter 7 or Chapter 13 can eliminate credit card debt.
2. Foreclosure – Many clients file for Bankruptcy to stop their home from being foreclosed upon and sold. They are afforded the opportunity to stop the foreclosure sale and save their home. The debtors can attend a mortgage mediation.
3. Repossession – Once you file bankruptcy, an “automatic stay” is entered and any effort to repossess your automobile must stop. Bankruptcy will stop or discharge any lawsuit related to a repossession. 
4. Wage Garnishment – Under current Florida law, if your wages or bank accounts are going to be garnished, you will not receive any notice until after the wages have been withheld or a hold has been placed on your bank account. Once you file for Bankruptcy, wage garnishment must stop, the money taken should be returned and the debt owed is discharged in bankruptcy. Garnishment cannot exceed 25 percent of your net wages. A creditor can continue to garnish your wages under a continuing writ of garnishment until the judgment is paid in full.
5. Medical Bills. 
6. Divorce.
7. Death of a spouse.
8. Lawsuits.

         

Secured debt is collateralized (secured) by property. A lender that owns the secured debt has the right to repossess or foreclose on the property.

What is unsecured debt?

An unsecured debt is when you agree to pay a creditor for a loan that was taken out by you, but you have not pledged any property as collateral for the debt.

How can I tell if a loan is secured by an asset?

Florida Secured Transaction Registry  https://www.floridaucc.com/uccweb/

What is an administrative debt?

An administrative debt is a priority debt. Generally, it’s for goods or services to your bankruptcy estate after you file your petition. An example of an administrative debt is the fee charged by an attorney or other authorized professional for services rendered after the bankruptcy case was filed.

A priority debt is a creditor that is entitled to receive payment before other creditors. They “stand in line first,” so to speak, when money is being distributed. The Bankruptcy Code 11 U.S.C. §507 defines priority debt as follows:

1. Unsecured claims for domestic support obligations.
2. Wages, salaries, or commissions, vacation, severance, and sick leave pay earned by an individual.
3. Tax on income or gross receipts for a taxable year ending on or before the date of the filing of the petition for which a return, if required, is last due.
4. A property tax incurred before the commencement of the case and last payable without penalty after one year before the date of the filing of the petition.
5. A tax required to be collected or withheld and for which the debtor is liable in whatever capacity.
6. An employment tax on a wage, salary, or commission of a kind specified in paragraph
7. Claims for death or personal injury resulting from the operation of a motor vehicle or vessel if such operation was unlawful because the debtor was intoxicated from using alcohol, a drug, or another substance.

A Chapter 7 bankruptcy is where a trustee examines your assets to determine if any property is available to be sold or recovered for the benefit of your creditors. Most if not all your property will be “exempt” under Florida law, meaning you keep it. If there are no assets to liquidate, you are considered a “no-asset case.” You will receive an order from the bankruptcy judge about 90 days after filing for bankruptcy. The order discharges your debts and gives you a much-needed fresh start. A “means test” is used as a threshold for determining whether debtors qualify for a Chapter 7. If a debtor’s income exceeds a certain amount, the debtor may not be eligible for Chapter 7 relief but instead must file a Chapter 13. The household limit varies based on your household size and expenses. The larger the household size, the higher the limit allowed for household income. Dependents can include non-relatives and non-minors if you are providing more than half of their support. A Chapter 13 is often used by debtors who do not qualify for Chapter 7 debt relief. Typically, you make payments in a Chapter 13 to the Trustee for 36 or 60 months depending on your disposable income. Unlike Chapter 7, the debtor does not receive an immediate discharge of debts. The debtor must complete the payments required under the plan before the discharge is received. The debtor is protected from lawsuits, garnishments, and other creditor actions while the plan is in effect. Debtors may bring the past-due payments on a mortgage current over the life of the plan.