What is the Bankruptcy Case Suitable for a Debtor?

What is the Bankruptcy Case Suitable for a Debtor?

Chapter 7 bankruptcy is not suitable for everyone. Only debtors who are eligible to file chapter 7 can obtain the advantages it offers. A person can be eligible if he meets the requirements through the ‘means test’. It is a procedure that is used to identify if the debtor’s income is not sufficient to file. This bankruptcy case is intended for individuals who have a small income and have trouble paying their debts. Undergoing the means test will evaluate the qualification of the client by removing the monthly expenses from the income. It helps the client discover his disposable income and compare it from the average disposable income of other members of the family. If the disposable income is lesser than the average disposable income the debtor is likely to qualify for chapter 7 bankruptcy. So, if the client’s disposable income is higher, then he cannot be entitled to file. Another option for the debtor is filing chapter 13 Moreno valley if his disposable income is too high to meet the requirements.

debt collectingThe client should file his case in the district where he lives or had lived for the last six months to file for chapter 7 bankruptcy. A filing is a simple as filling out a paperwork and filing it in the proper district. Remember to consult bankruptcy lawyer Moreno valley to check the possible options before filing a case. It is to foresee the after-effects it may bring for the coming years.

Bankrupcy AttorneyTo file for bankruptcy is to deal with some serious consequences and must not be decided without having some serious thought. There are three things that the client should know before jumping in a bankruptcy case and they are:

  • Do the client need the relief badly? If he is being chased by his creditors, the house is heading towards foreclosure, experiencing bank or wage garnishments then he can be relieved by filing a bankruptcy case.
  • Is the borrower entitled to file chapter 7 bankruptcy relief? The client must undergo the means test and be eligible. However, he did not qualify to file chapter 7, he can ask a bankruptcy attorney Moreno valley ca file chapter 13 if it can be applied.
  • Will the bankruptcy case make the situation better? Keep in mind that not every debt is cleared in bankruptcy. Unpaid income taxes, alimony and student loans and child support are the debts that are not discharged during bankruptcy.