Check Out If You Can File For Bankruptcy under Chapter 7
By: wystanfi | Posted: 15th November 2010
Debt relief is a huge concern nowadays for consumers who have been adversely affected by the recession. Job loss and pay cuts, a static real estate market and hiked interest rates have caused many hardworking consumers to seek protection under chapter 7 bankruptcy law in order to resolve their debts. The laws of the United States Bankruptcy Code are specifically designed to provide consumers in a variety of financial situations protection from creditors, and resolve all conflicts arising from their debt in a court of law. Chapter 7 bankruptcy law provides protection for consumers in serious need of debt relief, and who do not have enough income to support a repayment plan. These laws, while providing debt relief, also require that consumers surrender most of their assets to the courts, which then liquidate the assets in order to pay off the consumers’ debts. In return, any remaining balance on the debts is usually discharged by the bankruptcy judges.
If you are in need of debt relief, you might qualify to apply for protection under chapter 7 bankruptcy law. While this is ultimately determined by the laws of your state, there’s a guideline that will help you determine whether chapter 7 bankruptcy law can offer you debt relief. This guideline is your income. After stringent amendments to chapter 7 bankruptcy law in 2005, the means test was established to determine the level of a consumer’s income and how bankruptcy laws apply.
By measuring a consumer’s income against the state median, and measure whether this income is above or below the median, the pertinent authorities determine whether a consumer are able to maintain a repayment plan to pay off his debts over time. This means that if your income is below the state median, chapter 7 bankruptcy law most likely applies to your situation. Before filing for protection under the bankruptcy laws, you are required to take this means test and when you submit your petition, the proof of the means test must be included. If you do not agree to the outcome of the means test and have enough reason to request you may file for protection under the laws of another bankruptcy chapter, it’s possible to petition the court to review your case. If you decide to do this, you are best advised to retain the services of a qualified lawyer who is well versed in chapter 7 bankruptcy law.
To learn more about Bankruptcy and state bankruptcy law, Please visit http://www.statebankruptcylaw.net/.This article is free for republishing
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Tags: consumers, recession, debts, amendments, assets, chapter 7 bankruptcy, interest rates, financial situations, creditors, petition, bankruptcy laws, conflicts, repayment plan, debt relief, authorities, bankruptcy law, means test