Under the direction of Patrick Cordero, the Law Offices of Patrick L. Cordero, PA, in Miami, Florida, is one of the state’s largest bankruptcy firms. Patrick Cordero and his staff have helped many clients facing a difficult economic situation seek relief through bankruptcy.
Individuals have two types of bankruptcy potentially available to them: Chapter 7 and Chapter 13.
People may qualify for Chapter 7 bankruptcy if they meet a two-part eligibility test that determines ability to repay and compares income to the state median income. If the person in debt meets eligibility requirements, he or she may file for a “liquidation bankruptcy” in which certain types of personal debts are discharged in exchange for conversion of liquid assets to pay off a portion of the debt. State laws determine which assets are exempt from liquidation.
Chapter 13 bankruptcy involves debt reorganization. People filing Chapter 13 bankruptcy submit a plan to the courts showing how they will repay all or a portion of their debt over the course of three to five years. Chapter 13 bankruptcy allows people to maintain possession of liquid assets.
Patrick Cordero manages a private law office in southern Florida, where his primary focus is on helping clients find their way through financial turmoil. His practice is the second-largest bankruptcy-filing firm in the state of Florida with more than 55 employees. Most individuals worry about what will happen to their credit after filing for bankruptcy, especially as financial security in this country is based upon good credit. However, bankruptcy does not mean the end of credit. A good attorney can help bankruptcy filers prepare to achieve a more secure, healthier financial future, and most are able to obtain new credit within a year or two of filing for bankruptcy. In fact, they may have better credit than ever. Banks and credit card companies may be more apt to give credit to those without any debt because they are better able to make full and timely payments. Additionally, most individuals who go through the bankruptcy process learn valuable lessons and become better financial managers. If you are thinking about filing for bankruptcy, you are encouraged to meet with a bankruptcy attorney to learn what steps you should take next.
Individuals who are considering filing for bankruptcy to restructure their financial situations often want to know what differentiates Chapter 7 from Chapter 13 bankruptcy proceedings. Considered the simplest form of bankruptcy protection, Chapter 7 liquidates and redistributes the filer’s assets, which may include property, in order to pay off creditors. The end result is a reduction in, or elimination of, debt for the client, which can lead to financial peace of mind as well as an end to collections proceedings from debt recovery agencies. Because of the possibility of losing property, clients owning homes or land may opt for Chapter 13 bankruptcy, which offers more protection for individuals who own a greater amount of assets. To file for Chapter 13, clients must have a steady monthly income and be capable of repaying a certain percentage of the debt. An attorney with over 21 years in the practice of law, Patrick
Cordero runs his practice out of Miami, Florida. The Law Offices of Patrick Cordero is the largest bankruptcy filer in the state of Florida, and has helped thousands of individuals regain their financial security.
For nearly two decades, Patrick Cordero has served as one of South Florida’s premier bankruptcy attorneys. Cordero assists clients in matters relating to bankruptcy law. The first permanent bankruptcy law in the United States was enacted in 1898. Previous codes dealt with the liquidation of a debtor’s assets and distribution of the proceeds among creditors. The 1898 code provided for relief from creditors by means of “equity receivership.” The concept, derived from the way insolvent railroads were treated by the courts, allows debtors to retain ownership of their assets while paying some or all of their debt. American bankruptcy laws in the 20th century emphasized the rehabilitation of the debtor, where laws and practices beforehand had been much more punitive in nature. In many cases, debt becomes overwhelming not because of poor judgment on the debtor’s part, but because of circumstances beyond his or her control. For instance, in modern times, it is estimated that over 60% of all personal bankruptcies are due to unexpected medical bills. Punishing debtors who become the victims of circumstance is seen as serving no societal goal. Since the 1801 Act, bankruptcy law has evolved a great deal. Found at Title 11 of the United States Code, it provides for six different kinds of bankruptcy. The two most common filings, Chapter 7 and 13, are available to individuals and organizations. Chapter 7, considered the fastest and simplest form of bankruptcy, provides for the liquidation of a debtor’s assets, except for legally excluded items like primary residences and tools, with the proceeds distributed to creditors. Chapter 13 bankruptcy permits the debtor to retain ownership of all his assets as long as he makes payments to creditors in accordance with a plan he develops and presents to the court. The debts are then discharged. That is, the debtor is considered to have met his obligation and the creditor may no longer attempt to collect any amount due. Some debts, like child support and tax payments, generally cannot be discharged through bankruptcy. In 2005, the bankruptcy code was amended to discourage or prevent abuse, a phenomenon that commercial creditors asserted was a major problem. For instance, debtors must now pass a means test before being permitted to file under Chapter 7. They must wait eight years after the discharge of a bankruptcy before they may file again.
Completing the bankruptcy process comes with a slew of emotions, including an odd mixture of relief at no longer having to deal with collectors and anxiety at the thought of never receiving credit again. That source of anxiety is nothing but a myth. Always view bankruptcy in the proper light: a means of erasing past mistakes as you build toward a more financially secure future, one that can include credit. Remember, bankruptcy erases your debts, leaving you with significantly fewer financial obligations. Over time, you will collect offers for credit. Such offers will come with higher interest rates and lower limits, but by making payments on time and paying off balances quickly, those rates will lower and the limits will rise. Create a schedule to facilitate making timely payments. About the Author As the owner of the Law Offices of Patrick L. Cordero, PA, Patrick Cordero employs more than 56 employees, all focusing on bankruptcy law.
Patrick Cordero operates one of the leading bankruptcy and mortgage modification law practices in South Florida. Cordero’s practice serves as the second-largest bankruptcy filer in the nation. The framers of the U.S. Constitution wisely reserved to Congress the power to make rules and laws pertaining to bankruptcy. Throughout the 19th century, bankruptcy laws in the United States were considered only after financial crises. Before 1898, only three were enacted and each was repealed shortly afterward because of the costs involved and the high degree of corruption. The first such law, passed by Congress in 1801, was extremely limited in scope and applied only to traders and not individuals or corporations. In addition, the 1801 law provided only for involuntary bankruptcy imposed by a judge based on a debtor’s inability to meet a creditor’s demands in a lawsuit. Subsequent bankruptcy legislation expanded the population of entities that could be declared bankrupt; made provisions for voluntary bankruptcy; and introduced the concept of compositions, plans devised by debtors for the distribution of its assets among creditors. Without bankruptcy laws, debt collection was primarily governed by contract law. Creditors would sue delinquent debtors and, following judgment, seize their belongings to meet the amount due. Some states modernized their laws, declaring certain assets immune from such seizure, such as residences and tools of the debtor’s trade. They reasoned that without a place to live or tools to earn a living, a debtor would be rendered less able to pay a judgment. Individual debtors, as well as their families and servants, could be jailed if they were unable to meet their obligations. However, this practice fell into disfavor in the 1830s. Despite the need for a uniform national bankruptcy law, the Bankruptcy Acts of 1801 and 1841 were enacted after a period of national financial difficulty and intended to last only five years each. Both were repealed after only two years. The Bankruptcy Act of 1867 lasted longer, but was repealed in 1878. As the United States entered the Industrial Revolution, it had no uniform law governing bankruptcies. Instead, creditors dealt with delinquent debtors by means of an often punitive legal process that may well have exacerbated their financial hardships.
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