Debt is more than money owed. For some people it becomes a downward spiral that consumes your life, your health, and your loved ones while you work extra hard. Sometimes you can't fix the problem on your own. Declaring bankruptcy can mean a clean start, but it's a bold life choice and it's hard to know when it's the right time to file.
When many Miami residents receive their 2014 tax refunds, instead of making extravagant purchases or going on vacation, they will use the cash infusion to file for consumer bankruptcy.
South Florida homeowners may get a legislative reprieve if the Mortgage Forgiveness Debt Relief Act that expired last year gets an extension approved by both houses of Congress. The Senate Finance Committee recently approved an extension for two years that would be retroactive for the entirety of this year.
Filing for bankruptcy protection isn't something that same-sex married couples have been able to take advantage of to help take control of their financial future after debt takes hold of them. That is all changing, according to a memo given out by Attorney General Eric Holder.
Credit card debt, medical debt, and other problems lead some people to end up in major financial troubles. Some people try to combat these troubles by utilizing credit counseling services or bankruptcy to gain a fresh financial start. The number of people who have had to use these methods of debt relief has begun to decline.
Florida residents that may be considering bankruptcy may like to know that under Bankruptcy Code Section 523 (a) (15), debts incurred due to a separation agreement cannot be discharged when a person files for bankruptcy. For instance, in 2005, a court in Virginia ordered a divorcing husband to make spousal support payments to his ex-wife for ten years so long as either one was alive or until his ex-wife remarried. In 2009, the man argued to the court that his ex-wife had been living with a man in a marriage-like relationship for the past two years, which, under Virginia Code, should have been enough to terminate his spousal support obligations.
Florida homeowners who are struggling to make ends meet and do not want to lose their residences have a number of debt relief options, including filing for bankruptcy. The two types of bankruptcy that people file in these circumstances are under Chapter 7 and Chapter 13. If someone is current on their home loan, they can file for Chapter 7 and have their unsecured debts discharged, and there is no repayment plan required.
In a situation that may very well have happened in Florida, a couple rented a home together but were evicted after falling behind in rent. When they were no longer together, the man filed for bankruptcy and the back rent was listed in his filing. Both names appear on the filing, but the woman is now questioning her responsibility for the debt.
Florida homeowners should be aware of how bankruptcy laws may affect their situations when it comes to mortgages on their properties. Many homeowners may be current on their first mortgage, but may find themselves behind on a second mortgage that they may have taken out with a credit union and may be considering filing Chapter 13 bankruptcy in order to avoid foreclosure.
Florida residents may be interested to hear that a settlement was approved in the $40 million bankruptcy case of John L. Smith, former football coach at the University of Arkansas. This ended the Chapter 7 bankruptcy filing for Smith, who was ordered in the settlement terms to pay $265,000 in cash and hand over roughly $400,000 in real estate. The former interim coach of the Razorbacks filed for protection while still a coach at Arkansas. He was since let go from the team after a disappointing 4-8 season.