Do I Qualify for Bankruptcy?

Do I Qualify for Bankruptcy?

in User Help Last updated Apr 19, 2018
One of the most common questions regarding bankruptcy is how much debt someone must be in before they qualify for bankruptcy. Unfortunately, it’s not that simple. Debt consists of several indicators which must be evaluated to calculate assets to discover if balances are truly in the red. If you have a steady income that will cover your living expenses, you should investigate the different types of bankruptcy options that are available or debt consolidation to resolve your debt situation.

Calculate Your Assets

Calculating your assets correctly is very important. Consult with an attorney to be sure that you are qualified to declare bankruptcy. It is a common misconception to assume that just because you have more debt than income you should file.  If you and your attorney determine that bankruptcy is the best option, they will council you on the best bankruptcy option for your situation. 

Calculating Debt 

To qualify for Chapter 7 bankruptcy, your income must be low enough to pass the means test. If your income is higher and your unsecured debt is under $390,000 then Chapter 13 bankruptcy might be the best option. It is important to consult with an attorney, because every situation is unique, and they can guide you toward the best option. There are some debt calculators that are available online and free to use. These calculators help you start to gauge your level of debt and it that will affect your final decision. 

Bankruptcy should always be the last line of defense against a debt problem. If you are still able to manage your debt, be sure to consult with an attorney to find out if there are better options.

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