Are You Eligible To File For Bankruptcy In California?

To file for bankruptcy, an individual or business must meet certain criteria under the bankruptcy code.

These criteria have to do with your level of income, your level of debt and the type of debt you owe (i.e., unsecured vs. secured debts).

The complex nature of bankruptcy law, the purposes of various chapters, the income and debts you struggle with, and your specific goals (i.e., saving your home) will determine what type of bankruptcy you file as well as whether or not you are eligible to file.

At the Law Offices of Thomas P. Kelly III, in Santa Rosa, we perform a thorough analysis of our clients’ financial situations to determine whether or not bankruptcy is right for them in the first place. In many cases, it is their best option and we work to find a strategic way to use it while saving their assets from liquidation.

Attorney Thomas P. Kelly III has decades of experience in bankruptcy law throughout the Sonoma County area and uses his knowledge to help his clients out of dire situations.

Bankruptcy Qualifications And The Means Test

Your eligibility for bankruptcy is largely determined by your income level. The means test is one of the main tools used to determine which chapter of bankruptcy you file. Your income must fall below a certain level for you to qualify for Chapter 7 bankruptcy, which involves discharging your debts after a bankruptcy trustee collects nonexempt assets and uses them to pay your creditors. Most Chapter 7 bankruptcy cases are “no asset cases,” meaning the individual does not lose any assets to liquidation.

If your income is too high, it is assumed that you could reasonably make payments on your debts, as long as they are reorganized into a payment plan that works for you. Chapter 13 bankruptcy is used in these cases, and is most beneficial for individuals who need to save their home, save their vehicles or otherwise have assets to protect from liquidation.

Every case is different, so make sure to discuss your specific case with an experienced lawyer at our firm.

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