How to Find Out If You Qualify For Bankruptcy
While each chapter has its own guidelines and qualifications, some are under the impression that they don't qualify for bankruptcy with many mentioning the same excuses that could be keeping them from filing. Some feel they make too much money, others feel they don't make enough and some even claim they only have one type of debt such as medical bills . Most often, this just isn't true but reviewing your situation with a qualified bankruptcy attorney can help give clarity on such misconceptions.
Rules and regulations that are part of the bankruptcy process allow debtors the right and opportunity to be relieved from overwhelming debt. These federal laws are in place to ensure the process is completed in a fair manner. Usually your circumstances determine if you qualify to file; either Chapter 7 or Chapter 13 bankruptcy .
Chapter 7 bankruptcy eliminates or discharges eligible unsecured debt to give consumers a fresh start quickly. A means test is taken to review personal income and determine eligibility. You don't have to have a specific amount of debt to file this chapter but there are certain debts that cannot be discharged, such as child support or criminal fines.
Chapter 13 bankruptcy is a 3 to 5 year repayment plan approved by the court. Payment is collected by the bankruptcy trustee who forwards payment to creditors. Debtors who file this chapter should show they have suitable income to complete the plan.
There are certain occasions in which a debtor may not qualify. If you filed for bankruptcy previously, a certain amount of time has to pass before you can file again. Some may not qualify for Chapter 7 but may qualify for Chapter 13. If you're struggling with your financial situation speak with an experienced bankruptcy attorney to thoroughly review your options so you can obtain the financial relief you need.