How To Qualify For Bankruptcy? Here’s A Quick Talk On The Matter

How To Qualify For Bankruptcy? Here’s A Quick Talk On The Matter

How To Qualify For Bankruptcy? Here’s A Quick Talk On The Matter

Introduction 

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With mounting debts, it’s quite natural to consider filing for bankruptcy to wipe the slate clean and make a fresh start with no unsecured debts anymore. There are two types of bankruptcies commonly used, i.e.

Chapter 7 and Chapter 13 bankruptcies. In chapter 7 bankruptcy, some of your assets are sold to pay off all or some of your debts. In case you don’t own any property that can be sold, yet a majority of your debts get discharged at the end of the case.

Not all are eligible for chapter 7 bankruptcy, especially individuals with higher incomes, who can easily afford to repay their debts using Chapter 13 bankruptcy. Below are the criteria that make you eligible for Chapter 7 bankruptcy.

https://www.recoverylawgroup.com/credit-card-debt/

You ought to qualify the Means Test ď‚Ą

Means Test considers your income, family size, and expenses in order to determine whether or not you have disposable money to pay off your outstanding debts.

Means Test is compulsory when more than half of your debt is coming from consumer purchases than tax, tort debts or business. If your income fails to meet Means Test, it would mean you have enough disposable money left to pay off your debts.

You’re a married couple, small business owner or an individual     

You can never file for consumer Chapter 7 bankruptcy on a corporation, partnership or LLC’s behalf. You can file for it only if: You are an individual You are filing together with your spouse You are the sole business owner, and you have personal obligations on certain business debts You’ve not had any recent bankruptcy discharge.

“Can I file bankruptcy if already filed for a bankruptcy case earlier?” 

If one has filed for a bankruptcy case already, he or she has to determine if or not they qualify for another bankruptcy discharge. While one can file back-to-back bankruptcy cases, filing for bankruptcy discharge has limitations. An individual is restricted to the number of bankruptcy discharges he or she may receive within a specific time period. You need to consult an attorney for comprehensive understanding.

“Do I qualify for Chapter 7 bankruptcy if I have a job?” 

In Chapter 7 bankruptcy, your income plays the main role. Now, if you ask, ‘do I qualify for chapter 7 bankruptcy even if I have a job?’ the answer’s ‘maybe.’

Chapter 7 bankruptcy is reserved for those who have ‘negative’ income every month, because they don’t have money to pay off their outstanding bills. Some may even qualify for Chapter 7 bankruptcy despite having disposable income after repaying necessary mundane expenses every month.

Consult an attorney before you file for yourself

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It won’t be legal advice. If you are already considering filing bankruptcy and are not sure whether or not you qualify, consult a bankruptcy attorney. Bankruptcy is no simple game to play and win over. It is an intricate process, and especially if you are filing for the first time. An attorney will be a great help in order to guide you through.

Remember, even a silly input in the petition form can cause you rejection downright.

Recovery Law Group, a consumer protection law firm, makes an ideal choice for you to consult. They have been trusted and esteemed significantly for their incessant service toward the community of Los Angeles. Book a free consultation now.