What if my debt limits do not qualify for a Chapter 13?
In order to qualify for a Chapter 13 bankruptcy, the Trustee will look to a debtors overall secured and unsecured debts. Secured debts are backed by collateral.(i.e. mortgage, vehicle loan, etc) Unsecured debt is debt not secured by collateral meaning if you default on the debt there is nothing for the lender to repossess in order to satisfy the debt.
The new debt limits, effective April 1, 2011, are $1,081,400 for secured debt and $360,475 in uesecured debt. If a debtor exceeds these limits, he or she will be unable to file for Ch. 13 bankruptcy. An alternative may be Chapter 11 or have the debtor sell off assets to get under the debt limits.
If you choose the latter route, make sure you are upfront and honest with the bankruptcy Trustee about each transaction. The Trustee has the power to dismiss a petition if he or she feels there is abuse or fraudulent activity.
If you have questions about Florida Divorces or Bankruptcy Law contact a Florida Attorney
Greg Gilbert
Keith Maynard
