Filing for Chapter 7 — The Requirements
What must I prove to be able to file a Chapter 7 bankruptcy petition?
Bankruptcy laws can be quite complex, but a DebtStoppers Atlanta bankruptcy attorney can walk you through the process step-by-step.
The Georgia means test
In order to file, you first qualify under the means test, which determines whether you qualify for Ch. 7 based on your income level. The test comes in two parts, but you only have to pass one to qualify.
Part 1: Your median income — Your average household income for the previous six months is compared to the Georgia average. As long as your income falls below the Georgia average, you can file for Chapter 7. If not, you move onto Part 2.
Part 2: Your disposable income — This part's more complex, so your DebtStoppers attorney's experience will be helpful. Start with your take home pay and subtract your allowable expenses to find your disposable income, under Georgia bankruptcy laws, this is the amount you could use to pay your creditors. If your projected disposable income for the next five years will be less than $100 per month, you qualify to file a Chapter 7.
If your disposable income is more than $10,000 per year for the next 5 years, Georgia law prohibits a Chapter 7 and requires you to repay at least a portion of your debts with a Chapter 13 bankruptcy. There are, however, special circumstances that could still allow you to qualify to file Chapter 7. Your DebtStoppers attorney will explain this to you in full.
If your disposable income falls between $6,000 and $10,000, you'll need to pass another, more complicated test. This test compares your predicted disposable income to the amount of your unsecured debt. If your disposable income will be less than 25 percent of your total unsecured debts and non-priority debts, you pass the test and qualify to file a Chapter 7.
Most people who are considering bankruptcy end up passing the means test. But to make sure you're giving yourself the best chance of passing the test, you're wise to use the services of an experienced Atlanta bankruptcy lawyer.
Mandatory credit counseling and debtor education in Georgia
After you pass the means test, you'll attend a credit counseling briefing before you can file for Chapter 7 or Chapter 13. Before the bankruptcy court can discharge your debts, you must enroll in debtor education, otherwise known as a financial management course. A bankruptcy attorney can help you find a qualified credit counselor and enroll in a debtor education course.
Don't let worries about the requirements prevent you from acting to rid yourself of debt!
Let an Atlanta DebtStoppers bankruptcy attorney handle everything for you! We can help you through the preliminary process and answer any questions along the way. Call us any time at 678-673-2142 or fill out our debt analysis form online to schedule your free one-on-one debt evaluation.