Bankruptcy

Florida Chapter 13 Bankruptcy Rules

Florida chapter 13 bankruptcy rules have also witnessed significant changes after the introduction of the new bankruptcy laws in October 2005. Prior to the Bankruptcy Act 2005, debtors were allowed to make a choice whether they want to file their petition under chapter 7 or chapter 13. But, the Congress realized that many consumers (debtors) have actually started to abuse this convenience of choice. The number of bankruptcy fraud kept on increasing. The new act was implemented to prevent such possible abuses and fraud. As per the new laws, now there is a set of eligibility requirements that a debtor must meet in order to qualify for their petition under chapter 13. Following is a brief rundown on those compulsory requirements.

Your Income Must Be Higher Than The Median Income Of The State

As per Florida chapter 13 bankruptcy rules, you must first pass a means test. You can conduct this test on your own, but in order to file your petition with the court, you will need a certificate from an authorized credit counselor regarding the same. If you have hired a Florida bankruptcy attorney to handle your case, they will help you with the calculations. You can also do it on your own. All you have to do is just to get a pen and paper and write down your regular monthly income in one column and your regular monthly expenses in another column. Deduct the expenses from your income in order to find out how much money is left with you. Is this amount higher than the median income of the state? The median income varies depending upon the number of members in a family. For example, if there are three members in your family, you should compare your income (after deducting the expenses) with the median income of the families with three members.

Compulsory Credit Counseling

Florida chapter 13 bankruptcy rules also make it mandatory for the debtors to attend credit counseling prior to filing their petition. A certificate from a court approved counselor is very important. A petition that is submitted without this certificate is rejected straightaway. The credit counseling session usually does not take longer than 45 – 90 minutes. You are recommended to be well prepared before you go to attend such sessions. Your lawyer can help you with that.

As per Florida chapter 13 bankruptcy rules, your debts are never discharged. Instead, if the court finds that you are genuinely struggling with poor finances, it interferes and works out an affordable repayment plan for you, which both you and your creditors must accept.


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