Miami Bankruptcy Attorney Blog

People often do research on bankruptcy online, and some of the information they find out is entirely incorrect.  One of my favorites is when a client tells me that they read online that the bankruptcy court will NOT take your car away if it is your only mode of transportation.   What they are reading is ENTIRELY UNTRUE.   The fact that your vehicle is your only mode of transportation makes no difference as to whether or not you will be able to keep your car if you file for bankruptcy.  There are only three things that matter, regarding your car,

1. The value of the car – Use Kelly Blue Book (Private Party) or NADA Private Party
2. The amount of equity you have an a car -  Subtract the value of the car in number one by the amount you owe on the car.  If it’s positive you have equity, if it’s negative then there is no equity.
3. Your available Florida Exemptions to protect any equity in a car.

Florida Exemptions

Own a Home and Keeping it

Under Florida Law a debtor who owns a home and is keeping the home is entitled to exempt $1,000 in anything they want and an additional $1,000 in a vehicle.

Own a Home and Surrendering it or Rent a Home

Under Florida Law a debtor who owns a home but surrenders it in bankruptcy or a debtor who rents can exempt $5,000 in anything they want and $1,000 in a vehicle.  The debtor can use the $5,000 to protect the vehicle.

So if you own a car and you have excessive equity (ie you own the car outright) and can’t exempt all of the equity in the car, then you are left with TWO choices:  Either pay the difference or Surrender the car to the bankruptcy.

If any attorney tells you that they won’t take your car away BECAUSE IT IS YOUR ONLY CAR…. I suggest you run away, because your attorney is telling you false information.

If you are thinking if filing for bankruptcy and would like to schedule a free consultation with a local bankruptcy attorney then please contact Ofer Shmucher at Shmucher Law, PL by calling 305.741.5553 or 954.309.5559.  Shmucher Law, PL offers free consultations in any of our Bankruptcy office locations including Boca Raton, Fort Lauderdale, Miami, Plantation, and Sunrise Florida.

The bankruptcy trustee is what I would like to consider the referee of your bankruptcy filing.  The trustee has certain duties including: making sure your bankruptcy petition is prepared correctly, reviewing your assets (specifically valuations), and reviewing your case to determine whether or not you have committed any fraud and or have any assets that are not exempt and can be sold for the benefit of creditors.

The trustee’s primary duty is to find assets, specifically assets that are non-exempt so that the trustee can take and sell/liquidate your assets for the benefit of your unsecured creditors.  Examples of assets that a trustee can/will take from a debtor include cars, tax returns, monies in the bank, and personal injury lawsuits.  It is imperative to have an attorney that understands bankruptcy to represent you, so that you will likely not have any assets that the trustee will liquidate.

The trustees get compensated (paid) for administering your case.  They get paid for selling your assets and turning over the money to your creditors.

It is in your best interest to seek a qualified bankruptcy lawyer to represent you when you file for bankruptcy so as not to have any of your assets administered by the bankruptcy trustee.  If you would to schedule a consultation with a Miami Bankruptcy lawyer please contact Shmucher Law, PL at 954.309.5559 or 305.741.5553.  We have five offices located in Boca Raton, Fort Lauderdale, Miami, Plantation, and Sunrise Florida to serve you.

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Sometimes I meet with clients who are looking to file for bankruptcy in the greater Miami or Fort Lauderdale area, and my clients are either over their exemptions or have non-exempt assets but would still like to file for a Chapter 7 bankruptcy.   They can, but they risk the chance of losing their non-exempt assets or having to buy-back the portion that they are over on their current assets.  Here is how the process works.  If a debtor files for bankruptcy and has a car worth $4,000, under Florida law they can only exempt $1,000 leaving them approximately $3,000 over in exemptions, the trustee can do one of three things:

1. The trustee will give the debtor the option to buy-back the non-exempted portion of the asset.  This can happen in either a lump sum payment or a payment plan setup with the trustee.  In our example above the trustee can suggest the following:  A. Pay me a lump-sum amount to keep the asset.  If the debtor agrees to a lump-sum amount they can expect to receive a little discount over the $3,000 amount.  The lump-sum would likely be due within 10 days.  B.  Pay me $3,000 over several months to keep the asset.  Typically the payment plan will not exceed four months.
2. If the debtor cannot come up with the money to keep either the non-exempt asset or cannot pay for the overage of the exempted asset, then the trustee is entitled to take the asset and sell it to pay creditors.

If you are unsure whether or not you have assets that may be exempted or not then contact Shmucher Law, PL to schedule a free consultation with managing partner Ofer Shmucher in one of our five conveniently located offices throughout the greater Miami or Fort Lauderdale area.