Will I Qualify for Bankruptcy?
Bankruptcy Requirements in California
Bankruptcy is not something that can be pursued by anyone. There are certain requirements
that must be met. Since bankruptcy is a federal legal process, the laws
and regulations regarding bankruptcy are found in the
U.S. Code: Title 11, also known as the U.S. Bankruptcy Code. This code requires consumers
to prove that they have insufficient income to repay their debts, therefore
ensuring that no one can wrongfully take advantage of the bankruptcy process
for their own benefit.
Qualifying for Chapter 7
Chapter 7 bankruptcy or "liquidation bankruptcy" is the most difficult
type of bankruptcy to qualify for. Before filing, a consumer must first
pass the means test to prove that they have little to no disposable income
after paying for their living expenses. If you take the means test and
your disposable income is less than the state average, then you qualify
for Chapter 7. Otherwise, you may qualify for Chapter 13 bankruptcy.
Qualifying for Chapter 13
Consumers who do not pass the means test, but can still prove that they
have insufficient disposable income to repay their debt within a reasonable
period, may file under
Chapter 13. Even those who pass the means test and qualify for Chapter 7 may sometimes
benefit best for Chapter 13 bankruptcy. Under this chapter of the Bankruptcy
Code, consumers avoid liquidation. Instead, they continue to make monthly
payments for the next 3 – 5 years, after which time their eligible
debts are discharged.
Need a bankruptcy lawyer in Irvine? Call us now!
Contact us at Peter Rasla & Associates, P.L.C. if you are considering filing
for bankruptcy. An
Irvine bankruptcy attorney can review your situation and provide a case evaluation to help you take
steps in the right direction.
Call now at (949) 390-9994 or fill out our online
case evaluation form to get started!