Can a Person Be Disqualified from Filing for Bankruptcy?
If you are considering a personal bankruptcy filing in South Florida, you may be unsure about how eligibility works. Indeed, you may have concerns that there is some aspect of your current financial situation, or an issue in your financial past, that can disqualify you from a bankruptcy filing. According to a recent report from CBS News, this is a common concern among Americans who are struggling with debt and considering bankruptcy. In some cases, debtors do actually have their bankruptcy petitions rejected, according to the report, although most often there was an error that could have been addressed if the debtor had worked with a lawyer from the start.
For anyone who is considering a personal bankruptcy filing, what are disqualifying factors that you need to be aware of? Consider the following information from our West Palm Beach bankruptcy lawyers.
Failing to Pass the Means Test for Chapter 7 Bankruptcy
If you are an individual (or a married couple) planning to file for Chapter 7 bankruptcy, you will need to pass the “means test” in order to qualify for this type of liquidation bankruptcy. Since Chapter 7 bankruptcy involves the discharge of all of a debtor’s eligible debts at the end of the case — usually a period of approximately four to six months after filing the bankruptcy petition — a debtor must show that their resources are limited enough that a liquidation bankruptcy would not be an abuse of the bankruptcy system. If your resources are too high, you may not pass the means test.
Having Too Much Debt for Chapter 13 Bankruptcy
If you have too much secured debt, unsecured debt, or both, you cannot qualify for Chapter 13 bankruptcy. The current limits, good through March 31, 2028, are $1,580,125 in secured debt and $526,700 in unsecured debt. If you have too much debt to qualify for Chapter 13, you can still file for a similar type of bankruptcy under Chapter 11.
Filing for Bankruptcy Too Recently in the Past
If you have filed for bankruptcy in the past, you must wait a specific amount of time before you can be eligible to file again. The waiting periods depend on the type of bankruptcy you filed for previously, whether you received a discharge, and the type of bankruptcy you are planning to file for currently.
Contact Our West Palm Beach Bankruptcy Attorneys for Help with Your Bankruptcy Case
If you have concerns about your eligibility for a particular type of bankruptcy filing, you should always seek advice from an attorney before you make any assumptions or draw any conclusions yourself. Bankruptcy law is complex, and often, individuals and businesses are eligible for different types of bankruptcy that can allow them either to rebuild financially or to move forward without existing liabilities. If you have questions about filing for bankruptcy in South Florida and your eligibility for either Chapter 7 or Chapter 13 bankruptcy as an individual filer, an experienced West Palm Beach bankruptcy lawyer at Kelley Kaplan Delaney & Eller, PLLC can help. Contact our firm today to find out more about how we can assist you with all aspects of your consumer bankruptcy case.
Sources:
cbsnews.com/news/what-disqualifies-you-from-filing-for-bankruptcy/
law.cornell.edu/uscode/text/11
