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1. A bankruptcy filing automatically "stays" or postpones everything financial against the debtor, including foreclosures. However, it is a very routine matter for an unpaid lender to make a motion "for relief from the automatic stay
" to get permission to resume the foreclosure. If the property is worth less than the loan and the debtor is unable to resume regular monthly payments, it's virtually guaranteed to happen. The homestead exemption in Florida is limited to $125,000 in a bankruptcy case, but helps save a home only if it's either paid for in full, or the debtor is able to make the payments.
2. Real estate is handled by being reported on the appropriate asset forms (called "schedules"), and if the real estate is not exempt, it might be sold by the BK trustee
(or more commonly, the debtor will borrow money against the equity
of the real estate and give the money to the trustee). How any particular piece is handled depends on whether it is paid for or not. An "underwater" piece of real estate can be kept if the debtor re-affirms on the debt. If the debtor wants out from underneath the debt on any real estate, it must also be surrendered to the lender.
3. Income taxes are generally unsecured priority claims
, and a Chapter 7 case can discharge only older taxes where the returns were filed on time, the taxes were assessed, and they have remained unpaid for at least three years following the assessment. If the debtor has taxes due for a year that the 1040 has NOT yet been filed, then that debtor has made his or her life unavoidably difficult.
4. The only law governing attorney's fees in bankruptcy is that the fees must be reasonable. It's not price-fixing, but most cities tend to have two levels of bankruptcy attorney's fees: the low-ball "discount" rate charged by the "mills" who do large volumes of ordinary cases and usually do a lousy job of preparing their clients for the Section 341 Hearing (the official guy or gal, the Trustee, asks questions like "Why did you file bankruptcy?", and can probe into suspicious-looking financial facts he or she might find), and the 30-50% higher fees charged by firms that actually work for their clients.