Chapter 7 Bankruptcy, What is it?

Chapter 7 Bankruptcy, What is it?

When is Chapter 7 Bankruptcy Necessary?

Chapter 7 Bankruptcy can help the many regular individuals who find themselves financially over-extended from time to time.  Sometimes you are walking a fine line financially, and all of a sudden the line moves.  It’s not your fault, but you are now on the wrong side of the line.  You find that you are falling further and further behind each week, and fear there are no options left to help you.  This situation is far more common than most people would admit.  You may have already even thought about a Chapter 7 Bankruptcy, but you are not sure what it takes to file.

Chapter 7 Bankruptcy may be the right solution for you.  It provides protection to consumers that do not have enough income or assets to pay off their debts.  It is sometimes referred to as a total bankruptcy because it can eliminate most debts (with a few exceptions) that consumers have.

But, Will I Qualify for a Chapter 7 Bankruptcy?

To qualify for a Chapter 7 Bankruptcy, there are several tests that you must pass according to the law to receive a discharge in your case.  One test requires that you compare your annualized average monthly income based on the last six months to the median income for a family of the same size in your state.  This is referred to as the .  If your income is lower than the median income, then you pass the test and will likely be able to file.  However, if you income is higher (aka ‘above-median’), then there is a lot more information that will be used to determine whether you can file.

An above-median debtor should seek out the services of a skilled Chapter 7 Bankruptcy Attorney .  The Means Test is a tricky part of your Bankruptcy case.  A skilled Chapter 7 Bankruptcy Attorney can help you avoid many of the pitfalls that the means test presents.  Although it may cost more to hire an attorney with the necessary skill and experience, it will prove more cost-effective in the end based on the time and risk involved in ensuring that your complicated case is handled properly from start to finish.  I never advise shooting from the hip when it comes to bankruptcy.  Your future is at stake when you take the step of filing a Chapter 7 Bankruptcy.

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