Florida consumers should carefully consider the pros and cons of filing for bankruptcy (BK) before taking the plunge. For many heavily indebted Florida residents, BK is the only option that makes sense. Certainly, it is a last resort measure, but sometimes only Chapter 7 or Chapter 13 bankruptcy provides a way out for financially strained individuals. On the other hand, some Florida consumers considering bankruptcy might find a better solution through an alternate plan.
The Positive Side of Filing for Bankruptcy in Florida
Florida consumers who have no other viable option should know that bankruptcy is not the end of the world. Whether you file for Chapter 7 or Chapter 13 BK, there are positive points to consider. For example, when you declare bankruptcy, something called an automatic stay goes into effect. This automatic stay prevents creditors, lenders, and debt collectors from calling you.
Florida BK filers at risk for foreclosure or repossession also benefit from an automatic stay. Because, once it is in place, your property is at least temporarily safe. Then, even Chapter 7 filers may keep their homes and cars if the court considers the property “exempt” from liquidation. In Florida, people who file bankruptcy have an unlimited state exemption for their homes. Hence, most people who file for Chapter 7 bankruptcy in Florida retain their residences.
Also, in spite of credit score damage and other negative effects, Florida consumers who complete their bankruptcies escape their debt burdens. With Chapter 7, dischargeable debts go away entirely. On the other hand, a Chapter 13 BK reduces debt and makes payments more manageable. Either way, BK discharges typically give Florida filers a sense of relief and a fresh start with their finances and credit.
Finally, the negative effect of a bankruptcy on a consumer’s credit score, lessen over time. In fact, just three years after filing for bankruptcy, a consumer may be eligible for an FHA mortgage. Every six months after that, the negative effect on the consumer’s credit score lessens.
The Negative Side of Filing for Bankruptcy in Florida
For indebted Florida consumers on the fence about bankruptcy who think they have alternate options, there are definite drawbacks to filing. One of the big reasons to avoid bankruptcy if possible is the fact that it can destroy your credit score. In addition, a BK stays on your credit reports for a long time – 10 years for Chapter 7 and seven years for Chapter 13. So, even though you can start the credit repair process immediately, it will take time and effort to fully recover your credit score.
Next, Florida filers cannot discharge all of their debts. Certain debts such as student loans (federal and private) and past-due alimony or child support are never included in bankruptcy. This is why those considering BK should consider their debt types before filing.
Finally, getting approved for loans or credit cards with good interest rates after bankruptcy is tough. Of course, Florida consumers pay get loan offers immediately following discharge. However, post-bankruptcy credit normally comes with high interest rates and less-than-ideal terms. For the most part, lenders and creditors see bankruptcy as a big red flag. So, those who make the decision to file should understand that they will need to prove themselves as responsible borrowers. Luckily, this is not an unattainable goal, but lender trust won’t come back overnight.
Why Florida Bankruptcy Filers Should Check their Credit Reports
How quickly Florida filers can recover from bankruptcy depends largely on how committed they are to following a credit repair plan. Also, some of their success hinges on the accuracy of their credit reports. The truth is that both Chapter 7 and Chapter 13 Bk involve complicated processes. So, it is not at all uncommon for creditors and the credit bureaus to misreport certain details. Often, discharged debt isn’t accurately labeled as such on credit reports. Or, creditors inaccurately report debts included in Chapter 13 repayment plans as delinquent. Unfortunately, these types of mistakes work against your credit repair plan by unfairly bringing your credit score down.
Fortunately, Credit Repair Lawyers of America provides help to Florida bankruptcy filers. Just go to www.annualcreditreport.com and request your free annual copies of your credit reports from TransUnion, Equifax, and Experian. Then, go over your credit reports and check for inaccuracies. If anything looks wrong, whether it has to do with your bankruptcy or not, give us a call. Once you contact the credit pros at our firm, and experienced credit attorney will fix your credit reports – for free. Whether you have a Chapter 7 discharge or you’re in the middle of a Chapter 13 repayment plan, we can make post-bankruptcy credit report recovery easier and faster.
How to Get Free, Legal Credit Repair in Florida after Bankruptcy
Don’t let post-bankruptcy errors on your credit reports bring your credit score down. At Credit Repair Lawyers of America, we’ve been cleaning up credit reports for consumers since 2008 for free. How do we do it? All of our fees come from the defendants in cases that are settled. This is why our clients pay nothing for the work we do.
Let’s start the conversation about what we can do for your credit. Set up your free consultation today by calling Attorney Gary Nitzkin at (813) 940-7255 or sending him a message through our contact page.
For more information about Free Credit Repair, please visit https://creditrepairlawyersam.com/florida/credit-repair/.