Attorney Eric S. Ruff Attorney Lisa C. Cohen Gainesville Bankruptcy Attorney
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Bankruptcy Frequently Asked Questions

How much does bankruptcy cost?

There are three parts of the cost of filing bankruptcy, (1) the filing fee required by the court, (2) required financial counseling in two parts (done over the phone or internet), and (3) the attorney's fee for the legal advice, work, and representation. The filing fees are $335 for Chapter 7 and $310 for Chapter 13. The cost of the two sessions of required financial counseling is about $25 total (same for one person or a married couple).

The attorney's fee we charge depends on how simple or complicated your case is. People often ask us to quote a fee over the phone for a bankruptcy case before we have even met with them. It's not possible to give a sensible answer to that question until we have at least met with you and understand your situation. We do offer a free consultation -- an opportunity for you to tell us about your situation and for us to explain how bankruptcy law would apply in your case. At the end of the consultation, we will know which type of bankruptcy makes the most sense for you and we will also have a good idea of how much legal work your case would require to be done properly. We will quote you a fee at that time.

Generally speaking, Chapter 7 cases are the most common type of bankruptcy and the least expensive as well. Chapter 13 cases are more involved, more expensive, and more time consuming than chapter 7 cases. Chapter 13 cases usually take about 5 years, while chapter 7 cases usually take about 4 months until you get your debt forgiveness. Chapter 13 cases, in turn, are less expensive than Chapter 11 (business) cases, which are generally the most expensive common kind of bankruptcy, but are relatively rare compared to Chapter 7 and 13 cases.

Our fees are competitive. We think you will find our work outstanding. See what other clients have said about our work.

What is the effect of bankruptcy on my credit reputation?

This is one of the most commonly asked questions. Of course bankruptcy is a black mark on any credit report. The fact of a bankruptcy filing can be reported on your credit report for 10 years after which time it must come off. On the other hand, consider that most people who ask me this question have a credit reputation that is already heavily damaged, so bankruptcy may not make it any worse than it already is. If someone has a record of repossessions or judgments and is heavily in debt, it's doubtful he or she will be able to get a bank loan simply by avoiding bankruptcy. So for those people, they are not about to get a bank loan whether or not they file bankruptcy. So, what difference does it make? Also keep in mind that judgments stay alive in Florida for 20 years and can be renewed for another 20 years, so the 10-year credit reporting of bankruptcy may be better than having much longer-term judgments in effect. Finally, realize that credit is not really your friend. Credit is why you are reading this now. Credit means "the ability to go into debt." Stay as far away from credit as you can. If you want to buy a home, think about filing a bankruptcy to free yourself from past debts, then saving and saving your money until you have a significant down payment to offer a house seller who is willing to do owner financing.

Can a husband file bankruptcy without his wife filing, or must both spouses file?

Either spouse can file on his or her own. It is not required that they both file.

There are things in my house that don't belong to me. Will the Court seize these things?

No, they will not be seized. We are used to seeing situations where several people's property are mixed together. The bankruptcy papers you file with the court has a special section where you can list things in your possession that actually belong to someone else. We see this in roommate situations, people storing items for other people, and items on loan from one person to another.. Even minor children can own items, like toys, Christmas and birthday presents, and items they bought with their own money and these items are normally left untouched in the bankruptcy case of their parents. However, if you have transferred property to your children for the purpose of safeguarding it from your creditors, your children cannot keep those items and you may seriously harm your chances of a success in bankruptcy court.

My name is on my mother's checking account. Will they take her money?

The court looks to see the source of the funds in the account. That is, whose money is it really? If the money in your mother's account came from her retirement checks, the court will not touch it. But if you deposited some of your own money into the account, your deposits are subject to seizure. The most common situation, however, is that the person filing bankruptcy has never put a penny into the parent's account. The parent has just added the son or daughter's name to the account so that if the parent becomes unable to manage their funds, the child can do it for them. For example, if the parent becomes ill, the child can cut a check to pay the parents light bill or mortgage payment. In this situation, the parent's money is safe. We will report to the court that you have "legal title only" to the account (because your name is on the bank's signature card) but the "equitable title" (true ownership) lies with your parent.

If I file a Chapter 7, am I allowed to keep some of my assets?

Yes, the property you are allowed to keep is called your "exempt property." You can review the list of exempt property in Florida here.

Is it true that if I file for bankruptcy I can never again own anything?

No, I have heard this old wives' tale many times. In a chapter 7, for example, anything you buy with money you earn after you file bankruptcy is yours to keep.

I can't live without a Visa card, what am I going to do?

For many people, credit cards cause more harm than good. They lead to impulse buying and they mask the real pain of paying cash or even writing a check. Many people think they cannot live without a Visa card, but anthropologists have dug up some ancient bones and discovered there was life before Visa. Even today, many quaint businesses continue to accept cash! For those who absolutely, positively have to have some plastic in their wallets, there are debit cards available at Walmart with fairly low fees and no credit check.

I am current on all my payments. I have never been late on a payment. How can bankruptcy be appropriate for me?

I have many clients that are drowning in debt, but they appear to be "making it" because they have depleted their savings, then they have transferred the debt from one credit card to another (people really do pay their MasterCard bill with Visa) always in search of temporary low interest rates and pre-approved credit cards. Ask yourself what your total monthly credit card and loan payment is. Then ask yourself if you have enough income left over each month after paying normal living expenses to pay the minimum payment on all that debt. If you can't, then you are traveling backwards, even though you haven't defaulted on a loan - yet. The handwriting, however, is on the wall and it is only a matter of time until the house of cards collapses.

I am an honest person and I cannot stand the thought of not paying my debts, it's like cheating to me. How can I live with that?

Bankruptcy does not change your moral obligation to repay your debts; it only changes your creditors' abilities to use the legal process to force you to pay them. If you feel obligated to pay your debts, the law welcomes you to voluntarily pay your debts even after bankruptcy has forgiven them. And, if you pay a little bit towards a debt that has been legally forgiven in bankruptcy, that will not re-ignite the old debt, it remains extinguished. You would be free to pay any of your old creditors, in whatever order you wanted, however much you wanted, and when you wanted to do so. You could, for example, pay Visa $5 one month and then skip three years before paying again. You could pay back your friends and relatives before you get to the big banks.

I only want to file against some of my debts. I want to continue paying others is that OK?

Yes, you can continue to pay debts, even after a Chapter 7 bankruptcy. If the debt has collateral, then you can formally agree to be bound to that particular contract (like a vehicle or home purchase agreement) in what is called a Reaffirmation Agreement. If there is no collateral for the debt (cash loan from your parents or a friend) then you can continue to pay the debt on a voluntary basis. In either case, however, you must list in your bankruptcy papers all your debts, even the debts you intend to continue to pay.

How long does bankruptcy take?

A normal Chapter 7 takes about 3 1/2 months, but the relief is granted the moment your bankruptcy papers are filed. A Chapter 13 is usually a 36-60 month payment plan and is over about the time you make your last payment.

Do you have payment plans?

Yes, you can start with as little as $200 and we will get started on the work of preparing your court papers, which are extensive and take some time. Keep in mind, however, that a Chapter 7 case cannot be filed with the court until all the fees are paid in full. Why? If you still owe our firm for unpaid fees when we file your case that makes our own firm one of your creditors -- and we obviously don't want to file bankruptcy against our own firm!

There is an exception in Chapter 13 cases, we will sometimes, even now, be willing to accept some portion of our fees after you have filed from the monthly payments you make to the Court. That depends in part on how regular and predictable your income is.

What about Debt Management companies instead of bankruptcy?

Why is bankruptcy better than those "Debt Management" companies that advertise on TV and radio? Those folks want to negotiate with your creditors, but the creditors don't have to agree to anything. In Chapter 7 and Chapter 13 bankruptcy, we don't need the agreement of the creditors. The law just tells them how it is. Creditors may get something or they may get nothing, but they don't get to vote.

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