Category Archives: Bankruptcy Planning

Debt on Stripped Association Liens May Survive When Condo Sold

Though Fort Lauderdale chapter 13 cases routinely enable a debtor to strip the association lien for the amounts due prior to the filing of the bankruptcy, a recent case limits the benefit of eliminating the lien.  This lien stripping of association liens seems to be well settled law amongst the bankruptcy judges in Florida.  Thus a debtor who is way behind to his association, and might be on the eve of foreclosure with the association, can file chapter 13 and eliminate that lien if the property is worth less then the balance of the first mortgage.  (Note that if the association cannot be stripped, the debtor can still pay the arrears plus the current fees over 5 years.) The debtor would continue to owe monthly payments on the current association fees as long as the debtor remains on title. Associations have tried to find a legal argument against this lien strip…
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Posted in Bankruptcy Cases and Laws, Bankruptcy Planning, Chapter 13, Uncategorized | 1 Comment

New Means Test Figures Effective November 15

The means test figures change nationwide on November 15, 2013.  Cases filed after that date will use new numbers based on US Census Figures.   The median income based on household size changes.  As to a Florida means test,  strangely the income change is lower for household sizes of 1, 3, and 4, but higher as to household size of 2.  The difference is small, except as to a household of 4  the median income is almost $2,000 lower. The median income is as follows: Household size 1        $41,334 Household size 2          51,389 Household size 3          53,952 Household size 4          63,196, plus $8100 for each additional person. A further explanation of the means test and median income can be reviewed at my website by clicking the above Florida means test link.

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Bankruptcy First, Sell Homestead Later

Timing is everything in bankruptcy.  Bad timing cost one Florida debtor his home. The debtor’s homestead in Florida, with some exceptions, is exempt from creditors.  It is well understood under Florida homestead law including in a Florida bankruptcy that a homeowner may sell the home, retain the proceeds(in a separate bank account), and retain the homestead exemption in the proceeds for a reasonable time to purchase another exempt homestead. Carpenter v Scott Brown, 2013 US Dist Lexis 112607 (August 9, 2013) affirmed Judge Ray’s decision denying homestead exemption upon the sale.  But the facts of the case must be reviewed.  The debtor had already signed a contract to sell and the closing was scheduled for just after the filing of the bankruptcy petition.  The debtor did reside at the homestead on the date the bankruptcy petition was filed.  The key fact here is that the debtor was moving to Massachusetts to stay with family….
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