Bankruptcy in Florida
It’s an older story, but have you ever wondered why OJ Simpson has not paid the families of Nicole Brown Simpson and Ron Goldman any of the $33.5 million judgment? And, now, you’re likely wondering what OJ Simpson has to do with filing bankruptcy and Florida bankruptcy attorneys! The answer is exemptions and we’ll explain below.
In addition, we’ll show you how Florida bankruptcy law differs from the laws other states; discuss the differences between Chapter 7 or Chapter 13 bankruptcy; show you how to select a bankruptcy lawyer; and set you up to work with a bankruptcy attorney who can help protect your assets with exemptions. If you’re like most people, you’ll be relieved to learn that most people don’t lose any assets when filing bankruptcy.
How Florida Bankruptcy Law Differs from the Laws of Other States (and How that Difference Helped OJ Simpson)
At the time OJ was found to have caused the wrongful deaths of Nicole Brown Simpson and Ronald Goldman, his two main assets were his home and his NFL pension. His home was protected by Florida’s unlimited homestead exemption (which applies in bankruptcy cases as well). The NFL pension was protected by federal ERISA laws.
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Unlike most states, Florida offers an unlimited homestead exemption. This means no matter how valuable your home, you can file bankruptcy (or in OJ’s case, be found to have caused a wrongful death) and still keep you home. OJ’s house was worth over $500,000 in 1997 at the time of the $33.5 million judgment. The house could have been worth $50,000 or $50 million and still been protected.
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Like OJ, all Americans benefit from federal ERISA laws which protect the retirement plans that you set up at work such as a 401(k), 403(b), or pension. No matter how large the retirement account, it’s protected from lawsuit or bankruptcy.
It is significant to note that since the OJ case, Congress has passed a law that prevents forum shopping. The laws provides that if you want to protect more than $146, 450 under the homestead exemption, you have to have lived in that state for more than 40 months. This is 3 years and 4 months.
But don’t let this scare you, if you live in Florida, always consult with a qualified Florida bankruptcy lawyer. There is yet another Florida law that may protect your house even if you’re new to the Sunshine State; it’s called “tenancy by the entireties.” Tenancy by the entireties property is exempt if only one spouse is filing bankruptcy.
Would You Benefit Most from Filing Chapter 7 or Chapter 13 Bankruptcy?
Your bankruptcy lawyer will help you to determine which bankruptcy filing is the best fit for your individual situation.
- Only those who qualify can file Chapter 7 because most debts are discharged; however, we caution you. Don’t disqualify yourself. Let your attorney guide you through the process. You may have heard that you have to pass the “means” test, but your income is only part of the calculation.
- If you don’t qualify for Chapter 7 bankruptcy, then Chapter 13 bankruptcy is available. Most folks find Chapter 13 less desirable because fewer debts are discharged and it’s a long (3 to 5 year) process, but it’s still extremely helpful. Some debts are discharged, debts are renegotiated for more favorable terms, and creditor harassment is stopped.
How to Select a Bankruptcy Attorney
The ideal way to select a bankruptcy lawyer is to ask a friend or relative for a referral. If they’ve had a good experience, you likely will too. But, many folks filing bankruptcy want to keep the filing private so we encourage you to narrow your selection down to a few attorneys who limit their practice to bankruptcy. Email or telephone the office and request a free consultation to determine whether this lawyer is someone you’d feel comfortable working with.
How to Prepare to Work with a Bankruptcy Attorney
The absolute best was to work with a bankruptcy attorney is to collect all of your financial information including assets, income, debts, and any repayments made. Fill out all requested forms; each moment you spend on preparation may save you thousands or tens of thousands of dollars.
Where to Get Help Filing Bankruptcy
If you think that bankruptcy may be the right path for you, consult with a qualified bankruptcy attorney.
