If you believe that bankruptcy is the right debt relief solution for you, the first step is to determine what type of bankruptcy best suits your financial circumstances. Many debtors hope to qualify for Chapter 7 bankruptcy, which results in discharge — elimination — of most or all of your consumer debt. This can include credit card balances, medical bills and installments loans.
Chapter 7 debt discharge gives debtors a true opportunity for a fresh start. It does not take long to realize the benefits of a Chapter 7 bankruptcy once you qualify and file. Do not hesitate to give us a call and learn more about your options.
Determining if You Qualify Through the Means Test
How do you know if you are eligible for a Chapter 7 bankruptcy? Federal laws enacted in October 2005 require bankruptcy filers to take a means test to determine whether they qualify for bankruptcy at all, and if so, which type of bankruptcy they qualify for. We at Prescott & Pearson, P.A., welcome the opportunity to help you complete the means test with as little confusion as possible.
You most likely qualify to file Chapter 7 bankruptcy in Minnesota if:
- Your current monthly income is less than the median income for a household of your size in Minnesota (as of 2011, approximately $45,000 for a household of one, $61,000 for a household of two or $74,000 for a household of three, for example). If you are over the median income you may still qualify to file a Chapter 7 if you pass the means test (basically a standardized IRS budget).
- Your monthly expenses (including allowable housing, transportation, medical and living expenses) do not leave you with enough disposable income to repay your debts.
- You have not had another bankruptcy dismissed in the past 180 days because you failed to respond to the court or voluntarily halted it.
- You have received credit counseling from an approved agency within 180 days of filing.
Individual circumstances vary greatly. You should review your financial picture with a lawyer in person to determine what type of bankruptcy is right for you.
The Attorneys at Prescott & Pearson, P.A., Can Advise and Assist You
We are a long-standing bankruptcy law firm that has served Minnesotans for more than 40 years. Bankruptcy is all we do, and we do it well. If you are struggling with debt, let us give you the tools you need to start over.
Call our office in the Minneapolis-St. Paul area for a free consultation today at 651-968-8096 or reach us toll-free at 888-366-0827. We offer quality services at competitive rates and effective representation statewide.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.