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What To Do If You Can’t Pay Your Bills

The economy has improved since the start of the 2008 recession, but that does not mean it’s back to normal for everyone. As recent studies show, many South Floridians have still been left behind. A recent report shows that, although Florida’s wealthiest 1% saw a 40% increase, everyone else’s income dropped by 7%. Further, Miami-Dade County’s unemployment rate remains nearly the same as its lowest in 2008.

Chapter 7 Bankruptcy Can Give Retirees a Fresh Start

Chapter 7 bankruptcy has been called a “chance to hit the financial reset button.” When you can’t pay your bills, filing for bankruptcy under Chapter 7 can help you liquidate some of your assets to pay your creditors. Especially if you are retired, you should consider bankruptcy as a real option. That is because retirement income like pensions and 401(k)s are typically protected from creditors under bankruptcy. Qualified profit-sharing plans, individual retirement accounts, and Social Security payments are also protected. That means that if you are postponing bankruptcy and spending out of these accounts to pay off creditors, you may be losing out.

Chapter 13 is an Option for High-Income Filers

Debt can happen to anyone, even if you have a steady income. Bankruptcy is for anyone in debt, and having trouble paying debt. Your financial status will be subject to a means test to determine the best bankruptcy or debt relief solution for you. A Chapter 13 repayment plan plots out a five-year course to get your loans paid off and get you back on track. Chapter 13 has some benefits over Chapter 7 because you are able to retain more assets. Some people think folks who file for bankruptcy must be bad.   That stigma is convenient for the creditors. Bankruptcy is a law put in place by lawmakers who understand that sometimes honest, hardworking people just need a fresh start.

Homestead Exemption Protects Your Home

Many homeowners struggle with their house mortgage payments, and worry about losing their homes to foreclosure. Fortunately, under Florida law, many homeowners are protected from losing their homes under the homestead exemption. An unlimited amount of equity, or the difference between the home’s value and the amount owed on it, is generally protected. Your bankruptcy attorney can explain the rules to qualify for the homestead exemption. It must be your primary residence, and you can only rent it out for 30 days every two years. Estranged spouses can sometimes claim two exemptions. You should rely on your attorney to ensure you qualify to avoid homestead exemption fraud.

Negotiating with Creditors

You might think that your debt is set in stone.  A debt relief  attorney may be able to simply negotiate a lower payment with the creditors. It’s possible to come up with a payment plan or even settle the debt entirely. In some extreme cases, you may be judgment-proof, which means that you could refuse to pay the debt. This could apply to some retirees whose retirement assets cannot be collected.

Although seasonally adjusted employment rates in Florida took a dip this April, South Floridians still face tough times. If you are struggling to pay your bills, contact Florida bankruptcy and debt relief attorney Julia Kefalinos today. Don’t wait until it’s too late; seek assistance from your local legal professional.

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