Florida in Top 10 States for Business Bankruptcy Filings in 2017

Filing for bankruptcy can be a good solution for some people, but it all depends on your circumstances. That’s why talking to a lawyer before taking any action is essential. Making informed, wise decisions is how to get yourself back on the road to good credit and debt free.

The fact is that many other people find themselves in the same boat, especially in Florida. In fact, Florida was recorded as being in the top ten states for business bankruptcy filings in 2017, ranking at number four. This report also shows that most business bankruptcy filings are by choice, rather than requirement. However, whether you’re running a business and considering bankruptcy, or an individual with too much debt, there are a lot of factors to consider when looking at bankruptcy.

Here area few important factors that go into deciding what type of bankruptcy filing is right for you, or if bankruptcy is the best choice in the first place:

1. What Kind of Debt You’re Carrying

One of the most important questions is what kind of debt you’re burdened with. For individuals, filing for bankruptcy can take care of some debts, but not others. For example, if you’re drowning in student loans and you can’t seem to get ahead, bankruptcy isn’t the best option since educational loans cannot be discharged this way.

On the other hand, if credit cards have got you down, then you might be a good candidate for bankruptcy filings. One of the most common sources of overwhelming debt for many Americans, though, is the weight of medical bills.

Unpaid hospital bills can negatively impact your credit and medical institutions that you owe outstanding bills routinely will transfer that debt to a collection agency, and your credit score can drop dramatically. It’s possible to negotiate delinquency resolution with a seasoned attorney, though. This is where talking to a lawyer comes into play to discuss whether or not filing for bankruptcy is feasible and if it will help your case.

A bankruptcy filing stays on your credit report for at least seven years. Weighing the pros and cons of being debt-free with certain drawbacks, versus your credit score taking a beating, can best be figured out with the guidance of a lawyer.

2. Negotiation Versus Bankruptcy

Bankruptcy filings aren’t always the answer if you’re entrenched in debt. Negotiation is a powerful tool if wielded properly, since at times it’s possible to make arrangements with creditors. If you choose to go this route, there are two important things to know. One is that you should always talk to creditors directly and not their appointed debt collectors. The second is that enlisting a lawyer to do just that will be far more effective at protecting your assets and credit score than you personally fumbling through a conversation you may not know much about.

The fact is that creditors prey off a lack of knowledge and experience, so trying to talk to them before discussing your case with an attorney can do more harm than good. These conversations can be very productive, but it’s best to consult legal counsel once it gets to the point of negotiating debts. There are laws that protect you as a consumer that you may not be aware of. This is where a qualified attorney comes in.

3. How to Deal with Debt Collectors

In Florida, a debt collector is required five days after contacting you to send a written notice about how much money you owe to the lender. It is state law that debt collectors aren’t legally permitted to use false information or intimidation to pressure you into paying the debt on the spot. According to the Florida Attorney general, this includes threats such as violence, degradation of reputation, obscene language, public shaming, or harassing phone calls. One important thing to also note is that debt collectors must state their identities to the person whom they’ve contacted. In other words, if you get a call from a debt collector and the agent doesn’t state his or her name, it can potentially be considered a legal offense. Consulting with a lawyer is within your best interests once you get to this point.

4. Who’s Declaring Debt?

The question remains about who is seeking relief from debt that ends up in so many bankruptcy filings. When it comes to business, the last three years have seen Finance, Insurance, and Real Estate at the top of the bankruptcy statistics in Florida. There are two different types of potential filings for businesses. These are Chapter 7, Chapter 11, or Chapter 13. Chapter 7 is generally reserved for sole proprietors, and is most similar to personal bankruptcy. Chapter 11 and 13 are based on how much you owe, and if you want to keep your business running. Another reason is not qualifying for Chapter 7 but requiring protection from the harassment of creditors. Small businesses in industries that experience a high rate of bankruptcy may find the need to file for this status, but that doesn’t mean that they can’t keep going. Bankruptcy can also be a way to manage payments and overwhelming debt, depending on the type that you file, and whether it’s for business or personal finances.

Bankruptcy is a complex legal issue that is best handled by a lawyer. Whether you’re looking at debt counseling, debt negotiation, or bankruptcy filing, it’s all about what’s right for you. There are different types of bankruptcies and also different types of legal solutions that can reduce your monthly payments to creditors while still keeping your business open. The same goes for individuals considering Chapter 7 bankruptcy. The bottom line is that you need to have all of your information documented, and be ready to hire an attorney. Most lawyers these days offer a free consultation, or at least a pro-bono assessment of your case. If you feel you’re a good candidate to file for bankruptcy, then it’s worth calling a lawyer. Bankruptcy is neither a cure-all solution nor a fatal move. It’s just a legal action that requires knowledge and finesse to properly execute, which is why you’ll want a lawyer. Call a local attorney today who knows the ins and outs of bankruptcy in South Florida who can successfully represent your case and circumstances.

About Chad Van Horn

Chad T. Van Horn, Esq. is a South Florida business leader and founding partner attorney of Van Horn Law Group, P.A. Through a combination of dedicated philanthropy, spirited entrepreneurship and legal expertise, he applies his resources and network to helping people. Learn more about Chad Van Horn

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