Ziegler Diamond Law: Debt Fighters & Personal Injury

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This question is important because most people need their car to get to work and take care of their family. In a Chapter 7 bankruptcy case, the trade off for getting rid of your debts is that you are limited on the assets you can start over with. The governments tells us ""fresh start on the debt side, then fresh start on the asset side."" For filers who have resided in Florida for several years, the allowance for a vehicle is $1,000 in equity. Additionally, filers who do not own their home may also be able to access an additional allowance called the ""wild card"" to protect an additional $4,000 in equity in the vehicle. Even if a vehicle isn't in the allowances, there still may be strategies to hold onto the vehicle, including a 'buyback' agreement or by looking at a different debt resolution option. Call today to see what your options are to get rid of your debt and keep your car.

Garnishment is when a company you owe can reach into your bank accounts or paycheck and legally take your money. Except for the government, creditors can't garnish you when you first fall behind. They have to first file a lawsuit, serve you with the lawsuit, and win a judgment before the law allow them to garnish. The limited exceptions to this rule is if you have a loan with a bank but you also have a bank account with them, they're usually allowed to exercise a right call ""set off"" to take the money in that account (so you might want to move your account to another bank). Even after a creditor has a judgment, you might be able to get the money back and your wages protected if you qualify for any of a number of protections, such as Head of Family, Tenancy by the Entirety, Social Security and VA benefits, or if the account is holding someone else's money.

In a nutshell, Chapter 7 is what we call a ""liquidation,"" meaning the paperwork is filed and after a review period, the debts will be ""discharged"" (wiped out). There's no monthly payment in chapter 7; however, the filer's commitment for wiping out their debts is that they are limited on the amount of assets they can keep. The government tells us if you're going to get a fresh start on your debts, then you should have a fresh start on your assets as well. In Chapter 13 bankruptcy, the filer is committed to a payment plan for a 3-5 year period of time. There are a number of factors that go into the payment plan, but for most filers, it's based on what they can afford to pay. Choosing between chapter 7 and chapter 13 resolves mostly around the ""means test."" The means test is a calculation which says that if you make a little more money and can afford it, that you should pay a portion of your debt.

Hi Linda - thanks so much for your question! In a nutshell, bankruptcy is an option when someone's debts are disproportionate to their ability to pay. What is "too much debt" is different for everyone. $10,000 may be too much debt for someone on a fixed income, whereas $40,000 may be too much for someone with higher income. Sometimes debt builds up over time, but other times debt comes from a change in circumstances - such as loss of income, a medical or injury issue, or a divorce. We offer a free consultation to evaluate circumstances and see what options may make sense.

Hi Kelly: Thank you inquiring! We offer a complimentary half hour consultation.