Who Can File For Bankruptcy Under Chapter 7?

There has been a significant increase in personal bankruptcy filings in the US. The first half of 2009 itself has witnessed a sharp rise of 33%. It only goes to say that, the new bankruptcy law amended in 2005 which imposes certain restrictions on who may file for a chapter 7 bankruptcy have in no way slowed down the pace of filing for personal bankruptcies as expected by the law makers. Under tenets of the new bankruptcy rules law, to be eligible to file for bankruptcy under chapter 7, a bankruptcy filer is required to pass the means test to determine the net disposable income available to pay off the creditors.

Who can file for chapter 7 bankruptcy?

A chapter 7 bankruptcy deals with liquidation of assets to pay off your creditors. There are several different criteria outlined in the bankruptcy law that provide for guidelines on who can file chapter 7 bankruptcy. The prime requisite is that the bankruptcy filer must have a legal residency in the US in order to be eligible for the process. A proper consultation with File Chapter 7 bankruptcy could help you to understand the various qualification procedures enlisted in law. One of the main requirements to qualify for a chapter 7 bankruptcy filing procedure is passing of the “Means Test”. If a bankruptcy filer fails the means test he does not qualify for a chapter 7 bankruptcy.

The means test restricts number of bankruptcy filers under chapter 7

Under the new bankruptcy rules, to qualify for a chapter 7 bankruptcies, a debtor is required to undergo a “means test”. The calculation of the net disposable income involves taking into account your basic living expenses besides different components. The means test requires debtors to use average income and expenses over the last full six months immediately before filing. If you do not pass the means test automatically chapter 13 bankruptcy rules become applicable to your case under which you are required to repay your creditors through a monthly repayment plan approved by the court for a duration of anywhere between 3 to 5 years.

Thus, considering the aforesaid subtleties involved in bankruptcy filing it is always desirable to use professional services available online. However, be sure that you utilize the bankruptcy service of reputed service providers like www.Bankruptcyonly.com so that you could get proper guidance for your bankruptcy filing solution. Such services employ qualified and highly experienced bankruptcy attorneys who could actively assist you to understand the entire process of bankruptcy filing.

Personal bankruptcy have significantly increased last year in the US. But to fiiling chapter 7 you are required to be eligible for it. Hence, it is imperative for you to get proper guidance from a bankruptcy lawyer.