Chapter 7 Bankruptcy Port Saint Lucie and Surrounding areas



Chapter 7 Bankruptcy, often called the "fresh start bankruptcy" or "straight bankruptcy," is a liquidation proceeding.  Chapter 7 bankruptcy may eliminate most kinds of unsecured debt.  Some examples of unsecured debts Chapter 7 may eliminate are credit cards, medical bills, most personal loans, judgments resulting from car accidents, and deficiencies on repossessed vehicles.  The main purpose of a Chapter 7 is to give a person, who is hopelessly burdened with debt, a fresh start by wiping out his or her debts. 


What will a Chapter 7 Bankruptcy do for me?

The greatest benefit a Chapter 7 Bankruptcy is often a fresh financial start.

  • Stop Creditor Harassment
  • Start to Rebuild Your Credit
  • Stop Garnishments
  • Relatively Inexpensive
  • Eliminate Repossession Debts
  • No more medical or credit card debt
  • No payday or personal loans

In order to determine whether your specific debts are dischargeable via Chapter 7 bankruptcy, and whether all your assets will be fully protected, it is imperative that you consult with an experienced bankruptcy attorney.  At Murphy and Murphy Law Group, our attorneys will take the time to conduct a thorough analysis of your situation, address all your concerns, and discuss the options that best fit your personal situation.


The  prestigious Law Firm of Murphy and Murphy Legal Group has been serving clients on the Treasure Coast in Stuart, Port Saint Lucie, Jensen Beach, Hobe Sound, Palm City and the North Palm Beach communities for over 45 years in Bankruptcy and Foreclosure law


Call Murphy and Murphy Law Group at  772 223-8600 772 223-8600 today to schedule a free consultation, or contact us online. 


 The  prestigious Law Firm of Murphy and Murphy Legal Group has been serving clients on the Treasure Coast in Stuart, Port Saint Lucie, Jensen Beach, Hobe Sound, Palm City and the North Palm Beach communities for over 45 years in Bankruptcy and Foreclosure law


Is a Chapter 7 Bankruptcy Right For You?


If you are drowning in debt and you feel as though there is no end in sight, bankruptcy may be the best option for you.  The following are a few questions for you to consider: Are you struggling at the end of the month to pay your living expenses?  Has your credit card debt become virtually unmanageable?  Are you falling behind in paying on your personal loans and/or payday advances?  If you answered "yes" to one or more of these questions, then Chapter 7 bankruptcy may be your best option.


Bankruptcy no longer has the personal stigma attached to it that was previously thought.  Many people mistakenly believe that filing bankruptcy will destroy their credit for the next ten years, and that they will be prevented from purchasing property within that time.  Not only is that far from the truth, in many cases filing a bankruptcy is the first step in rebuilding one's credit.  Credit is based on many different criteria, including debt-to-income ratio.  


In many instances, filing for bankruptcy will allow you to improve your credit rating sooner than later.  By making on-time payments on new debt incurred after your bankruptcy, you may begin reestablishing your credit rating within a relatively short time from your discharge.  Therefore, filing bankruptcy may actually help your credit score because discharging your debts greatly improves your debt-to-income ratio.

Another point to keep in mind is that without those high minimum payments, you can actually start to save money each month and prepare for your future instead of living month-to-month, paycheck-to-paycheck.  To find out if you qualify for a Chapter 7 bankruptcy, you should contact the Murphy and Murphy Law Group at  772 223-8600 772 223-8600 today to schedule a free consultation.  Or contact us online. 


Chapter 7 Eligibility


A Chapter 7 bankruptcy will usually take approximately 3-4 months to complete from the filing of the bankruptcy petition to the discharge of the debt, although this process may take longer for more complicated cases.  To qualify for relief under Chapter 7 of the Bankruptcy Code, the debtor may be an individual, a partnership, or a corporation or other business entity.  Subject to the means test, relief is available under Chapter 7 irrespective of the amount of the debtor's debts or whether the debtor is solvent or insolvent.  An individual cannot file under Chapter 7, or any other Chapter, if during the preceding 180 days a prior bankruptcy petition was dismissed due to the debtor's willful failure to appear before the court or comply with orders of the court, or the debtor voluntarily dismissed the previous case after creditors sought relief from the bankruptcy court to recover property upon which they hold liens.  In addition, no individual may be a debtor under Chapter 7 or any Chapter of the Bankruptcy Code unless he or she has, within 180 days before filing, received credit counseling from an approved credit counseling agency either in an individual or group briefing. 


At Murphy and Murphy Law Group , our experienced attorneys will conduct a free consultation, which includes a thorough analysis of your situation in order to verify eligibility.  Once the attorney verifies eligibility, he or she will skillfully guide you throughout the entire process from start to finish.  


One of the primary purposes of bankruptcy is to discharge certain debts to give people a "fresh start."  The debtor has no liability for discharged debts.  In a Chapter 7 case, however, a discharge is only available to individual debtors, not to partnerships or corporations.  Although an individual Chapter 7 case usually results in a discharge of debts, the right to a discharge is not absolute, and some types of debts are not discharged.  Moreover, a bankruptcy discharge alone does not extinguish a lien on property.  To determine whether you have a lien is removable you should seek the advice of an experienced attorney.  At Murphy and Murphy Law Group  our experienced attorneys will assist you in obtaining lien records, and will discuss your options in removing the subject liens.


Dischargeability of Debts


When filing Chapter 7 bankruptcy, a typical outcome is that the debtor is discharged from liability for most unsecured debts.  Here is a list of debts not typically discharged, however consulting with an experienced bankruptcy attorney is always advised:

The most common non-dischargeable debts include:

  • All debts not listed in the bankruptcy petition
  • Student loans - unless undue hardship to repay
  • Taxes - federal, state, and municipal
  • Fines for violating the law: including criminal fines and traffic tickets
  • Court-ordered alimony and child support
  • Debts for personal injury caused by driving while intoxicated (i.e DUI)

In addition, a creditor may ask a court to determine that some debts are non-dischargeable, including:

  • Debts incurred because of fraud
  • Debts for willful injury to another's person or their property
  • Divorce and other property settlements
  • Debts from embezzlement

Allow one of our experienced bankruptcy attorney's lead you through the complete process from beginning to end.  We will be by your side every step of the way.  Don't be fooled by other firms where you meet with the attorney once and then your case is passed off to a legal assistant to complete.  The attorneys at Murphy and Murphy Law Group, will lead you through the complete process from your initial consultation to the discharge of your case.


The  prestigious Law Firm of Murphy and Murphy Legal Group has been serving clients on the Treasure Coast in Stuart, Port Saint Lucie, Jensen Beach, Hobe Sound, Palm City and the North Palm Beach communities for over 45 years in Bankruptcy and Foreclosure law.

Chapter 13 Bankruptcy

Chapter 13 Bankruptcy is significantly different from a Chapter 7 Bankruptcy.  A Chapter 13 is a reorganization of debt, allowing Debtors to repay all or a portion of their debts through a Chapter 13 plan while protecting property and personal assets.  The concept is similar to debt consolidation, but unlike most debt consolidation programs, it permits debtors to pay unsecured debt (i.e. a debt that is not secured by property) down without accruing interest (student loans are an exception) and without having to deal with those annoying calls from debt collectors.  Under a typical plan, you make monthly payments to a court appointed bankruptcy trustee for generally 36 to 60 months.  The amount of your monthly payment is determined by several factors such as the amount of debt you have, your ability to repay and the extent that you have assets.  Once a Chapter 13 repayment plan begins, a trustee will disburse the monthly payment made by the debtor to the creditors on monthly basis.


Is a Chapter 13 Bankruptcy Right For You?


If you choose to file a Chapter 13 Bankruptcy, the court will require you to use your income to repay some or all of you debt.  This means you have to prove to the court that you can afford to meet your repayment obligations.  Don't let this scare you.  A Chapter 13 repayment plan is based upon how much you can afford to pay back based on your monthly living expenses.  The court essentially allows you to pay back as much as you can afford over a 3 to 5 year time period.  At the end of this time period, if you completed your payment plan, the court will discharge the rest of your eligible unsecured debt.  If you cannot afford to pay back any of your debts, you may be able to qualify for a Chapter 7.


Stop Foreclosure on Your Home Immediately


 The  prestigious Law Firm of Murphy and Murphy Legal Group has been serving clients on the Treasure Coast in Stuart, Port Saint Lucie, Jensen Beach, Hobe Sound, Palm City and the North Palm Beach communities for over 45 years in Bankruptcy and Foreclosure law.  A Chapter 13 offers individuals an opportunity to save their homes from foreclosure.  By filing a Chapter 13, debtors are allowed to repay their arrears (i.e. overdue/ past due payments) over 3 to 5 years, which allows individuals to save their homes.  Chapter 13's may also allow a homeowner to avoid refinancing and surrendering the equity they have built in their homes.  Debtor's can instead save their equity and pay their arrears back in their Chapter 13 Bankruptcy.


Save Your Car from Repossession


If you have fallen behind on your car payments, a Chapter 13 may allow you to save your car from being repossessed.  A Chapter 13 will allow you to reinstate your original loan agreement and to make up missed payments over time.  Under certain circumstances an experienced attorney may even be able to recover your vehicle after repossession, and consolidate the remaining balance.  In some cases you may also be able lower your car payments and pay back a figure based on the actual market value of the car as opposed to what you owe pursuant to the initial loan.  You will need tocontact an experienced bankruptcy attorney to see if this is an option for you.


Pay Back Income Taxes


Typically debts that you owe to the government are not dischargeable, however including them in your Chapter 13 plan may have many benefits.  More specifically, Chapter 13 bankruptcy freezes interest and penalties on taxes.  This will allow your payments to go directly to the principle, greatly reducing your interest and penalty burden.  Chapter 13 will stop the government from adding more penalties and interest to your back taxes.


Chapter 13 and Student Loans


In most circumstances, a bankruptcy court will require repayment of student loan debt.  Chapter 13 bankruptcy rules treat student loan debt similar to priority debt--it is payable in full like back taxes and child support payments.  Prior to 2005, student loan debt was only dischargeable when funded by a private lender.  With the passage of the Bankruptcy Abuse Prevention and Consumer Protection Act, however, privately funded student loans are now treated the same as student loans guaranteed or issued by the federal government.  This means that all student loan debt is only dischargeable upon a showing of undue hardship.

Typically, it is difficult to convince a bankruptcy court to discharge student loan debt.  A bankruptcy court will consider such factors as poverty, the inability to pay the loan due to a permanent disability, and a debtor's good-faith effort to repay the loan for a long period.  To have a student loan debt dismissed, a debtor must file a separate action in bankruptcy court called a Complaint to Determine Dischargeability of a Debt.


Protect Your Co-Signers


Did a family member or friend co-sign on a loan for you, that you are now having trouble paying for?  Are they receiving harassing creditor calls and threats from creditors?  Filing a Chapter 13 will protect your co-signers from receiving those harassing collection calls and efforts.  A Chapter 13 allows you to pay the remaining balance on those loans over 3 to 5 years and in some instances with no interest.  Call Murphy and Murphy for a FREE Consultation.


Questions & Answers


1. What is stable and regular income?

Stable and regular income is income from regular wages or salary, income from self-employment, wages from seasonal work, commissions from sales or other work, pension payments, Social Security benefits, disability or workers' compensation benefits, unemployment benefits, strike benefits, public benefits (e.g. welfare payments), child support or alimony that you may receive, royalties and rents, and proceeds from selling property.


2. What is considered disposable income?


Disposable income is the money left over after you pay for basic human needs. Examples of these necessities include: food, mortgage or rent, utilities, transportation, insurance, certain allotted installment payments. These basic needs are taken into consideration in formulating a plausible Chapter 13 proposal.


3. How much will my plan payment be?


Your monthly plan payment is based on the amount of debt you have and how much you can reasonably afford to pay.  In some circumstances your payments will be enough to pay off all your creditors.  Some debt need not be paid in full and can be paid pennies-on-the-dollar.


4. What kind of debt is dischargeable?


Dischargeable debt includes unsecured debt (e.g. credit card debt, medical bills, some taxes, etc.).  While student loans and liens are not dischargeable, they can be paid through a Chapter 13 plan.


5.  If I miss a scheduled payment under my Chapter 13 repayment plan, can a creditor begin collection activities?


Should a debtor miss a scheduled payment, Chapter 13 bankruptcy rules allow the trustee to institute an action for dismissal with the bankruptcy court.  Because the debtor agreed to repay creditors according to a court-approved Chapter 13 repayment plan, a trustee may request the dismissal of the case once those creditors are no longer receiving payments.  A debtor may be able to prevent the dismissal of a case by establishing their ability to repay the debt under the current plan or by requesting that the court approve a new plan.

If the bankruptcy court dismisses the case, a creditor may reinstitute collection activities against the debtor.  Bankruptcy laws that prohibit collection attempts no longer protect the debtor at this point.  Consequently, creditors may collect the current amount owed on the debt and any interest on the debt that accrued while the debtor was in bankruptcy.


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