What If You Don’t Qualify for Chapter 7?

So You Didn't Qualify For Chapter 7 Bankruptcy, Now What?

If you do not qualify for Chapter 7, don't despair. Some people don't qualify for Chapter 7 at first, but after taking certain actions they qualify for Chapter 7 later. Remember, there are always options to help you deal with your debts.

Pre-Bankruptcy Planning to Qualify For Chapter 7 Later

Some people will need to make some changes to their financial situation in order to be able to qualify for Chapter 7, and this takes some time. For example, some people will have to wait a few months for the impact of their reduction in income to fit within the guidelines of Chapter 7. This is a very common strategy because many people file bankruptcy after the loss of a job, or a substantial reduction in income and need to wait for the changes to be reflected in their 6-month average income. Your attorney will advise you if a strategy is available to help you qualify for Chapter 7 at a later date.

If You Don't Qualify for Chapter 7, Consider Chapter 13

Individuals that don't qualify for Chapter 7 generally wind up filing Chapter 13. While most people prefer to file Chapter 7, there are some strong advantages to filing Chapter 13. For example, Chapter 13 can reduce the amount of some car loans. It can also eliminate a second mortgage on an underwater home. Chapter 13 also allows the debtor up to 60 months to pay non-dischargeable debts such as taxes and past-due court-ordered spousal and child support without the debtor getting in trouble with the taxing authority or the court during this time. If this does not seem like a good deal, consider being able to force the IRS to take the payment you decide to make. Plus, the IRS can't levy your bank accounts or take any action against you during the time you are in Chapter 13.

There Are Always Strategies to Deal With Debts

No matter what, there is a strategy that will help you get out of debt and help you resolve your debt issues so you can get control of your financial life again. If bankruptcy is not an option, there are solutions such as debt negotiation, credit counseling, and debt consolidation that may work for your individual situation. Of course, these solutions are not as favored as bankruptcy because the results are not as assured as the results of bankruptcy. So, when considering one of these options, make sure that you choose your provider carefully and make sure that you know what you are getting into before you sign on the dotted line.

If You Have More Questions

Please contact us if you have more questions or are ready to move forward and start the process of becoming debt-free. Remember, we are here to help you resolve your debt problems, so call us now!

(949) 954-7568