Eligibility Requirements for Chapter 7 and 13 Bankruptcy

Are you presently contending with out of control and crushing debt? If so, you may want to consider filing for bankruptcy or even alternatives to bankruptcy. For many, bankruptcy can offer an effective and powerful solution to financial troubles; however, the first question that most people has is, “Do I qualify for bankruptcy?”. The answer is, that it depends on which chapter you are filing for.

Contact us online or call 530-898-1488 if you have questions about qualifying for bankruptcy. 
Our bankruptcy attorney in Chico is ready to give you an answer.

How Do You Know if You Qualify for Chapter 7 Bankruptcy?

If you are considering Chapter 7, also called debt liquidation, you will need to pass the means test. The means test will compare your income with the median income for your state, for a household of your size. If your income falls below the median income of your state, then you automatically qualify for bankruptcy via Chapter 7. If your income is above the median, you still have a chance to qualify. Simply reach out to a qualified bankruptcy lawyer near you! If it turns out that your income truly is too high, you may qualify for Chapter 13 bankruptcy instead.

Other requirements for Chapter 7 bankruptcy:

  • You cannot have a recent bankruptcy discharge via Chapter 7 in the last 8 years and via Chapter 13 in the last 7 years.
  • You did not attempt to file for Chapter 7 or 13 in the last 180 days and it was dismissed by the court for specific reasons such as violating a court order.
  • You must complete a credit counseling course 180 days before you file.

How Do You Know if You Qualify for Chapter 13 Bankruptcy?

If you are thinking of filing for Chapter 13, also called debt reorganization, the qualifications are as follows:

  • You must earn a regular income.
  • Your debt must be below the limits (valid through April 2022):
    • Unsecured debts: $419,275
    • Secured debts: $1,257,850
  • You cannot be behind on your tax filings.
  • You cannot have filed Chapter 13 in the last 2 years or Chapter 7 in the last 4 years.
  • You also cannot have filed for Chapter 13 or 7 in the last 180 days that was dismissed for specific reasons

If you are contemplating filing for bankruptcy or have more questions about how to qualify for bankruptcy, it would be in your best interests to speak with our lead attorneys from The Law Office of Nikki Farris. We have been practicing bankruptcy law in Butte County for two generations so you can feel confident knowing that we can provide you with honest, reliable answers to your questions.

Learn of All Your Legal Options

Your journey will begin with reviewing your unique set of circumstances in detail. Although bankruptcy may be a viable solution for many, it’s not for everyone. Whether you wish to file for bankruptcy, or if you want to pursue another course such as a loan modification, The Law Office of Nikki Farris will let you know if bankruptcy is right for you. We can also explain what bankruptcy can and cannot do, and together we can find the best solution that will suit your individual set of circumstances.

Chapter 13 bankruptcy is mainly for those individuals who have a steady source of income who can afford to pay off their debts, or a portion thereof in monthly installments for the next 3 to 5 years. Each individual Chapter 13 is different, how much one has to pay towards their debts depends upon several factors including their financial ability to make monthly payments. At times people may ultimately pay off a fraction of their debts as opposed to the entire amount they owe. The purpose of a Chapter 13 bankruptcy is for people to get into a Chapter 13 repayment plan that they can comfortably afford.

A Chico Debt Relief Lawyer Who Provides Trustworthy Legal Counsel

At The Law Office of Nikki Farris, we have been practicing bankruptcy law for several years and we are honored to serve the residents of Butte County in all of their bankruptcy needs. We encourage you to contact our firm as soon as possible to learn more about our bankruptcy services. We are here to answer any questions you may have about bankruptcy exemptions, collections defense, or how to put a stop to creditor harassment. We can also explain how discharging your debt works, as well as how bankruptcy can protect you from wage garnishment and repossessions.

To find out if you qualify for bankruptcy, contact a Butte County attorney from the firm by calling 530-898-1488 to schedule your initial consultation!