Chapter 7 Bankruptcy
Chapter 7 Bankruptcy is a court-supervised process that allows individuals and businesses to discharge most of their debts. It's also known as "liquidation bankruptcy".
How it works
- A trustee examines assets to determine what can be sold to pay creditors
- Non-exempt assets are liquidated to pay creditors
- Debtors receive a discharge that releases them from personal liability for dischargeable debts
Benefits
- A fresh financial start without future obligations on discharged debts
- Creditors can't collect on discharged debts
- Debtors aren't required to pay back certain things
Who can file
- Permanent Florida residents
Income limits
- Median income limits vary by household size
- If your income is below the median, you may qualify for Chapter 7
Exemptions
- Florida has strong exemptions to protect property, including the homestead exemption to protect your home and exemptions for your 401 (k) and certain other retirement accounts
- Other considerations
- Some debts can't be eliminated, such as tax debts, child support, alimony, and student loans
- You will need to complete a personal financial management course to receive a discharge