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

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