How Do I Qualify for Chapter 7 Bankruptcy?
If you are experiencing ongoing financial difficulties with no end in sight, you might be thinking that Chapter 7 bankruptcy can be a solution for you. You are not alone in this, as many people find themselves in a position where they cannot pay their debts and are searching for relief.
At Reed Law Firm, we regularly find solutions to financial crises for our clients, often through Chapter 7 bankruptcy. We can assess whether you qualify and, if you decide to proceed, handle every step of the process. Consult our South Carolina Chapter 7 bankruptcy attorney now to discuss your options.
Understanding Chapter 7 Bankruptcy
Chapter 7 bankruptcy is commonly known as “liquidation bankruptcy,” and it is designed to provide a clean financial slate by eliminating most of a consumer’s unsecured debts. These can include:
- Credit card debt
- Medical bills
- Personal loans
- Other types of consumer debt
However, certain types of debts such as student loans, child support, and many tax debts may not be eligible for discharge. Discuss with your lawyer which debts might be discharged or not before you decide to file a case.
Not just anyone can file for Chapter 7 and have debts wiped clean, however. To qualify for Chapter 7 bankruptcy, you must meet certain eligibility requirements. These requirements are determined by the means test, which takes into account your income, expenses, and family size.
The Means Test
The means test compares your average monthly income for the past six months to the median income of a household of your size in your state. If your income is below the median, you automatically pass the means test and qualify for Chapter 7 bankruptcy. However, if your income is above the median, you will need further calculations to determine your eligibility.
The second part of the means test calculates your disposable income by deducting certain allowable expenses from your monthly income. Allowable expenses include rent or mortgage payments, utilities, transportation costs, healthcare expenses, and other necessary living expenses. If your disposable income falls below a certain threshold, you will qualify for Chapter 7 bankruptcy.
Working with a South Carolina Chapter 7 Bankruptcy Attorney
Knowing whether you qualify for Chapter 7 can be complicated, and having a South Carolina Chapter 7 bankruptcy attorney handling these calculations can be invaluable. A qualified attorney will handle the means test, gather the necessary supporting documentation, and ensure you meet all the requirements to file Chapter 7 bankruptcy.
Additionally, a bankruptcy attorney will oversee the rest of the process. They will ensure your creditors abide by the automatic stay, which is a legal protection that prevents them from taking any further collection actions against you. They will also help you apply the exemptions available in South Carolina in the most beneficial way, which allows you to keep certain assets, such as your home, car, and personal belongings.
Contact Reed Law Firm Today
If you are considering filing for Chapter 7 bankruptcy in South Carolina, Reed Law Firm is here to help. Our experienced South Carolina Chapter 7 bankruptcy attorneys will provide you with personalized guidance and support throughout the process. Contact us for a free consultation now.
