Tag: Automatic Stay

Consumer Bankruptcy

New Year, Fresh Start. Bankruptcy Can Help You Take Back Control of Your Finances

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The New Year is a popular time for financial check-ins, motivating people to set goals like paying off debt. For those struggling with overwhelming debt, bankruptcy can be a legal pathway to a fresh start, eliminating eligible debts.

Before filing for bankruptcy, certain steps should be taken to ensure the case goes smoothly and is successful.

  1. Stop using credit cards.

One of the reasons people file for bankruptcy is due to overwhelming credit card debt. As soon as someone decides to file for bankruptcy, it is always recommended that he or she immediately ceases using their credit cards. Bankruptcy courts will view creating more debt when the person knows that it will never be repaid as a form of bankruptcy fraud.

  1. Pay for the essentials.

Many filers find themselves behind on bills prior to filing, including rent and utilities. Prior to filing for bankruptcy, make sure you are caught up on essential living expenses, including paying rent and utilities.

  1. End automated payments.

Many consumers set up automatic payments with their bank and creditors, allowing creditors to auto debit their bank account. While this may be a convenient method, once a bankruptcy case is filed, it can quickly become a giant inconvenience. With the automatic stay, creditors are prohibited from directly soliciting payments on debts owed by the filer, but this does not necessarily mean these payments cannot be made via automatic monthly withdrawals that were in place prior to filing. To avoid this problem, prior to filing, consumers should sign on to all online accounts with creditors and end automatic payments.

  1. Gather financial records.

Organize recent pay stubs (60 days), bank statements, tax returns (2 years), asset details (home, cars), and creditor statements.

  1. File your tax return.   

If someone is considering bankruptcy, taxes are often the last thing on that person’s mind. However, it is important that a consumer considering bankruptcy file his or her tax returns prior to filing. After all, the bankruptcy court will be looking at the consumer’s income and assets when deciding bon what type of bankruptcy can be pursued, and tax returns are vital documents needed to make that determination.

5. Review Your Credit Report.

Get a copy of your credit report for free by visiting Annual Credit Report.com – Home Page. Free weekly online credit reports are available from Equifax, Experian and TransUnion. Credit reports play an important role in your financial life, and we encourage you to regularly check your credit history to ensure accuracy.

You can regain control of your financial future in 2026. The consultation is free; the relief is real. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild, and recover. The day you hire our firm; we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

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305-285-9100

1370 Coral Way, Miami FL 33145

Bankruptcy Filings, Bankruptcy Trends, Chapter 7 Bankruptcy, Consumer Bankruptcy

Personal Bankruptcy Filings are Soaring – But How Do You Know When You Need a ‘Financial Reset’?

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Chapter 7 consumer bankruptcy filings have increased 15% in the first nine months of 2025, according to American Bankruptcy Institute. That amounts to 249,152 filings so far this year as compared to the 216,773 filed last year for the same period, according to data from Epiq AACER. Individual Chapter 13 filings also increased by 4.3%.

The rise in bankruptcy filings can be attributed to the growing financial pressure families are facing across the country. Inflation has outpaced wage growth for 43 percent of Americans.

Chapter 7 bankruptcy is a powerful legal tool that allows those in financial crisis to cancel debts such as credit card debt, medical debts, and personal loans.

As soon as a Chapter 7 bankruptcy case is filed, the consumer receives immediate protection from his or her creditors. This protection comes from the automatic stay that is issued by the court upon filing. The automatic stay puts a pause on all collection actions, including collection phone calls, legal proceedings to collect on a debt, wage garnishments, evictions, and foreclosures. The automatic stay also gives consumers a chance to breathe and work with the court and bankruptcy trustee.

It can be difficult to determine whether it is the right time to file for Chapter 7 bankruptcy. Typically, those that file should meet the following criteria:

  • Have a low credit score.
  • Have no foreseeable way to pay off debt within the next few years.
  • Do not possess expensive property.
  • Have more than $10,000 in debt
  • Struggle to make payments.
  • Are in fear of legal action being taken against them due to debt.

An alternative to Chapter 7 bankruptcy is Chapter 13 bankruptcy. Most commonly, those that opt to file for Chapter 13 fail to qualify for Chapter 7 due to their income. They may also own a property that is not protected by Chapter 7 bankruptcy exemptions. An experienced bankruptcy attorney can provide crucial assistance in evaluating your finances to determine which plan is best suited for your situation.

If you have questions or are in a financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can assist you and address all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

SOURCE: Personal Bankruptcy Filings Are Soaring This Year Due to ‘Mounting Financial Pressure’ — but Do You Know What It Means To File and the Alternatives?

Bankruptcy Law, Consumer Debt, Debt Relief

When Is an Emergency Bankruptcy Filing Necessary?

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An emergency bankruptcy filing is a streamlined process used in situations where the filer urgently needs to stop a creditor from collecting on a debt. It is often referred to as a skeleton bankruptcy filing because it’s so simplified.

The filer receives the same benefits and protections they would in a standard bankruptcy case. Like the automatic stay, which puts an immediate halt to all collection activity. The emergency filing gives the same protection after completing certain online forms and submitting the remaining required documents later.

The shortened process allows you to start a bankruptcy case by submitting an incomplete, otherwise “bare bones” filing. The best part about an emergency bankruptcy filing is that it can be completed online and in a matter of minutes.

A specific emergency isn’t required for a skeleton filing. Anyone who needs to file quickly to prevent an unwanted event from happening can use the process. For instance, bankruptcy can stop:

After filing the petition, the bankruptcy automatic stay goes into place and stops these types of issues immediately.

When is an emergency bankruptcy filing appropriate? It is appropriate when a debtor is facing an imminent foreclosure on his or her home or a repossession of his or her vehicle. Since the amount of paperwork needed to formally open a bankruptcy case is significant and cannot be done overnight, it may not be done quickly enough to stop the foreclosure or repossession from happening. However, with an emergency bankruptcy petition, it is possible to be done quickly enough to get the automatic stay and protect the filer’s assets. The key is the filer must file the additional documents within 14 days or his or her bankruptcy petition will be dismissed. The filer must also comply with other rules, which will be provided on the court’s website.

Certain documents are required for an emergency bankruptcy filing. The bankruptcy petition is the essential part of the bankruptcy case, which will determine which chapter of the bankruptcy code forms the basis of the filing. The creditors’ contact information is also required with the emergency bankruptcy filing, along with a credit counseling certificate of completion or a waiver request, along with a Form B121. The filing will also be accompanied by a filing fee, although the filer can submit a request for a fee waiver. It is also possible to submit the fee in installments if this makes the situation more financially feasible.

Occasionally, the filer may also need to complete additional paperwork, as required by the court. It is important that the filer complies with these requirements, or the court will dismiss the bankruptcy petition within a certain required period, usually within 14 days.  

If you have questions on this topic or are in financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Source: JUSTIA.com

Wage Garnishment

Can a Debt Collector Garnish Your Wages Without Telling You?

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If you have fallen behind on credit card payments, you know first-hand the lengths creditors will go to collect on what you owe. One of these methods goes beyond incessant phone calls, letters, and text messages, it’s called wage garnishment. This is when a creditor is given legal permission to collect what is owed by deducting a portion of money from your paycheck before it reaches your bank account.

This can cause big issues with your finances, especially if it comes without warning. So, can debt collectors take your money without telling you, first?

The simple answer is no. The law dictates specific steps a creditor must take to be able to garnish a person’s wages to satisfy a debt. Without these protections, a creditor could simply take money out of the person’s bank account.

The wage garnishment process starts with the creditor or third-party debt collector filing a lawsuit to formally collect the debt. If this lawsuit is successful, the creditor or collector will receive a judgment against the creditor. This legal judgment gives the creditor the authority to then ask the court to issue a wage garnishment order, allowing them to satisfy the debt by garnishing the consumer’s wages. Once signed, this order is sent to the consumer’s employer to start the garnishment.

The good news is certain steps can be taken to stop a wage garnishment.

Filing for bankruptcy in Florida puts an automatic stay on wage garnishment, which immediately stops Florida wage garnishment. The automatic stay lasts for as long as the bankruptcy. With the automatic stay in place, you will be able to take home your entire paycheck.

One important thing to keep in mind is creditors can only garnish a certain percentage of the consumer’s paycheck. Federal law dictates that the amount garnished from a person’s wages cannot be more than 25 percent (25%) of his or her disposable income or the amount taken that by which the person’s take-home pay exceeds 30 times the federal minimum wage, whichever of these two figures is less.

One exception does exist when it comes to wage garnishments. Federal law dictates that the consumer’s wages, as well as his or her social security benefits, can be garnished to pay student loan debt and back taxes owed. The U.S. Department of Education and IRS are given authority under federal law to garnish the consumer’s wages without a court judgment or even filing the lawsuit. No official garnishment order is needed for either entity to garnish a person’s wages.

A person can take certain steps to stop a wage garnishment before it even starts. One thing a consumer can do is to work directly with the creditor to negotiate a payment plan to pay down the debt in lieu of a wage garnishment. Many times, creditors prefer this be done before the collection action is even initiated, saving them the legal fees associated with starting a legal proceeding. Payment plans also allow the consumer to set a reasonable amount for a monthly payment, one that will fit with his or her budget. Negotiating a payment plan once the garnishment order has been issued can be a little harder, so it is recommended this action be taken before that order is issued.

Bankruptcy Law, Consumer Bankruptcy

Why DIY Bankruptcy Might Not Be a Good Idea

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Filing for bankruptcy yourself, or without an attorney, is known as filing bankruptcy “pro se”.  Representing yourself throughout the bankruptcy process is a risky decision and there are a number of pitfalls associated with the same.  Filing for bankruptcy has a complex set of rules, forms, statutes, and judicial decisions.

Some people choose to represent themselves because they think they cannot afford to hire a bankruptcy attorney, or they may think they have a simple case.  Whatever the reasoning, it is not a wise decision. Even the simplest bankruptcy case could soon become complicated, resulting in the filer’s case being dismissed or thrown out. Often it is worth the extra cost to hire a professional to assist the consumer in filing for a Chapter 7 or Chapter 13 consumer bankruptcy as it saves a lot of hassle in the long run.

Bankruptcy Law, Consumer Bankruptcy, Divorce

How Will a Bankruptcy Case Affect my Pending Divorce?

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People will hold off on filing for bankruptcy for several reasons, especially if they are in the midst of a pending divorce case. The fear is that a bankruptcy case will affect the ability of the parties in a divorce case to divide their property. While a bankruptcy case will not affect a family law court’s ability to handle child custody and child support matters, the bankruptcy will prevent the court from finalizing a division of marital property.

Consumer Bankruptcy

Questions to Ask Yourself Before Filing for Bankruptcy

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The decision to file for bankruptcy is never an easy one. It takes careful consideration and depends on a number of factors. Before making the decision to file for bankruptcy, ask yourself these questions.

Have All Other Options Been Exhausted?

Bankruptcy is not the only option when it comes to debt relief.  It often helps to first meet with a bankruptcy attorney to discuss your options. A budget is one tool a consumer can use to see what unnecessary expenses can be eliminated, freeing up additional funds to pay off debts. The consumer may also have luck in selling some of his or her assets to pay off various debts. Another option is for the consumer to reach out to his or her lenders to see if some type of payment plan or debt settlement can be reached on the debt.

The consumer may also consider credit counseling. This step should be taken even if the consumer is considering filing for bankruptcy since credit counseling, including a two-hour financial management course from a government-approved agency, must be completed at least 180 days before a bankruptcy discharge is issued.

Bankruptcy Law, Consumer Bankruptcy

When Should I File Bankruptcy?

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Chapter 7 bankruptcy is a powerful legal tool that allows those in financial crisis to cancel debts such as medical debt, credit card debt, and unsecured personal loans.

As soon as a Chapter 7 bankruptcy case is filed, the consumer receives immediate protection from his or her creditors. This protection comes from the automatic stay that is issued by the court upon filing. The automatic stay puts a pause on all collection actions, including collection phone calls, legal proceedings to collect on a debt, wage garnishments, evictions, and foreclosures. The automatic stay also gives consumers a chance to breathe and work with the court and bankruptcy trustee.  

Bankruptcy Law, Consumer Bankruptcy

When Is Filing for Bankruptcy the Best Option?

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Making the decision to file for bankruptcy is never an easy one. Many individuals hold off on filing for fear of what it will do to their credit or worse, fear of the unknown. For many consumers, taking that first step and initiating a bankruptcy case can be the best option for them. The key is deciding when to take that step.

The longer a person stays in debt, struggling to pay bills, defaulting on liabililities, the worse the financial damage will be.  Not to mention the emotional toll it takes.  By not taking action, a person can risk being sued by thier creditors or having their wages garnished. Credit card companies, creditors and even the IRS can take legal action to garnish your wages to pay off outstanding debt.