No one seeks out financial problems; however, when they arise, one is likely to seek out solutions to these problems. Debt relief can look very different from person to person, but in some cases, it means exploring bankruptcy. Although the mere thought of filing for bankruptcy seems taboo, it is in fact not only a commonly used debt relief option, it is also the reason a person is able to have a fresh financial start.
Before initiating the bankruptcy process, one needs to determine if he or she is eligible. Eligibility is based on certain factors, and for those seeking to file for Chapter 7 bankruptcy, he or she must first establish he or she is eligible. What makes one eligible for Chapter 7 bankruptcy?
It should be noted that not everyone qualifies to file for Chapter 7 bankruptcy. These individuals are those with higher incomes who could afford to repay his or her debts through a Chapter 13 bankruptcy. In order to qualify for Chapter 7, one must pass the means test. This means that is one’s monthly income for their family size does not exceed the state’s median, than he or she will likely be able to file for Chapter 7.
In addition, one must not have had a recent bankruptcy discharge. If one filed a previous chapter 7 bankruptcy within the past 8 years or a Chapter 13 in the past 6 years, he or she is not eligible to file for Chapter 7. Finally, one must go through credit counseling before they can file. This must be completed no more than 180 days before a bankruptcy filing.
Whether you are seeking more information, want to file for bankruptcy or are in the process of filing for bankruptcy, it is important to be well informed. This will help ensure you take the steps necessary to help address any financial or debt problems you are currently dealing with.