Many people who file for Chapter 7 view it as a way to get out of debt and put an end to the financial challenges they have been experiencing for quite some time. Although it is a common option that many turn to when their debt gets out of control, there are certain eligibility requirements that they must meet in order to file. Of these many requirements, your income is one of the most important.
Because income is one of the factors that is examined, not all people are eligible. This is especially true for those who have an income that is considered too high. Also known as the “means test,” the debtor is asked to take their average income from the six months preceding their bankruptcy application and compare it to the state’s median income. If it is higher, they are not eligible.
Often, when people file for bankruptcy, they have a very limited income that doesn’t even come close to the state’s median. When a debtor’s income is above this number, it may be assumed that can make the payments on their debts. Should you still feel as though you cannot pay your debt, there are other options available to you that may allow you to find debt relief.
It can be stressful living with an overwhelming amount of debt and no money to pay your bills. Many people may feel as though they have no way out, but there are many options that they can take advantage of when they are trying to eliminate debt. If you are eligible, speaking with an attorney about filing Chapter 7 bankruptcy could be the answer to your financial troubles.