How Do I Know If I Qualify For a Chapter 7 Bankruptcy?

To many people, Chapter 7 Bankruptcy is a more attractive alternative to filing a Chapter 13 bankruptcy.  This is because most debt is immediately wiped out following the filing.  The filing period is also much shorter and the process is more straightforward.

Qualifications

In order to qualify for a Chapter 7 bankruptcy, you’ll have to pass what is called the means test.  This test takes into consideration your income, expenses, household size, debt, and other considerations.  If your income is less than the median income for a household of the same size in California, then you will almost certainly pass the means test.

Your income is determined by your total gross income over the past 6 months x 2.  If you cannot pass the means test but you expect that your income will decline over the next few months, waiting to file is an option to consider.

The following chart shows the California median income by household size:

And while income is the most important factor, it isn’t the only one.  If you earn more than the median income for a household of your size, find out if Chapter 7 bankruptcy is still feasible for you by calling your Yuba City bankruptcy attorney at (530) 797-4402.