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What Should You Know About Filing Chapter 7 Bankruptcy?

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Although you may be tempted to file for bankruptcy as soon as you experience financial problems, it is a better decision to take your time and weigh the consequences. You should first consult with an experienced attorney because this is an important step in your life, and there are many different areas of law that must be considered before deciding whether or not bankruptcy will work for you. It ultimately depends on the situation. So, finding the right bankruptcy lawyer is important.

A bankruptcy lawyer’s website can mostly tell the kind of cases they have handled. It is better if you can find out if the lawyer’s firm has handled similar cases to yours. You should also check on their fee rates.

Here are what you should know about Chapter 7 bankruptcy.

  • Your average monthly income in the last 6 months should be lower than the median income for the same-sized household in your state

To qualify for Chapter 7 bankruptcy. your average income in the last six months should be lower than your state’s median income. The means test is an assessment of the household’s income and expenses that determines whether or not you are qualified to file for Chapter 7 bankruptcy. An attorney can be able to provide you with more information regarding your location or state-specific information on bankruptcy.

  • You shouldn’t have filed for Chapter 7 bankruptcy in the last 8 years or for Chapter 13 bankruptcy in the last 6 years

The law states that filing for bankruptcy shouldn’t be your first choice of solution to your problems. Maybe that is why you are not allowed to file for a Chapter 7 bankruptcy if you have filed for Chapter 7 in the last 8 years or Chapter 13 bankruptcy in the last 6 years. This is to prevent people from declaring bankruptcy when they really can just manage their current financial problems by making some simple adjustments to their lifestyle.

  • You must wait 181 days for refiling if your Chapter 7 or Chapter 13 bankruptcy was tossed out

If your bankruptcy was dismissed, you should wait for 181 days to file again. That is how long you have to wait before you can refile for Chapter 7 or Chapter 13 bankruptcy. You have this period of time to determine whether or not your financial situation has improved.

Eric Lilly
the authorEric Lilly