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Florida Bankruptcy Lawyer
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Understanding debt management and bankruptcy

Many Florida residents are struggling with unmanageable amounts of debt. They may be using credit cards to pay the minimums on yet other credit cards, have debt collectors calling them, be on the verge of eviction and other issues. A person who is in this type of situation may benefit by filing for bankruptcy protection.

Bankruptcy is available in order to help people to get a fresh start. When people are simply unable to pay their bills, it may be an option to consider. They need to know the type of bankruptcy that would work best for them. Chapter 7 bankruptcy is a liquidation proceeding. In this type of bankruptcy, the person’s non-exempt assets are liquidated in order to repay creditors. Since a large number of assets are exempt under Florida law, many people are able to keep most or all of what they own. At the end, most of the debtor’s unsecured debts are discharged, meaning that creditors can take no further action in order to try to collect them.

Chapter 13 is a reorganization of debt. Through this, debtors repay all of their priority debts and a portion of their unsecured debts over a repayment plan lasting between three and five years. Upon successful completion, most of the remaining unsecured balances are discharged.

Chapter 13 is a good option for people who are facing the loss of their home and who have regular sources of income. It can stop the foreclosure action while giving people a longer period of time to catch up their mortgages. If a person is upside down in the home, lien stripping may be available for second mortgages or home equity lines of credit in some cases. A bankruptcy lawyer may advise a client about the best approach to take.

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