If you have no job or any other income coming in, and you’re heavily in debt, you may wonder about your options. The good news is that lacking a job is actually a good thing when it comes to Filing Chapter 7 bankruptcy. Why?
If you have a high paying job, you are often not eligible for Chapter 7 bankruptcy. For example, if you make over $40,456 in Georgia as an individual, you are not eligible for Chapter 7 bankruptcy. This number varies from state to state. Let’s go into more detail on how the means test, your job status,and Chapter 7 bankruptcy work.
No Job is Good
As noted, if you have no job, you are likely eligible for bankruptcy. If you have no other income coming in, the majority of the time you are eligible. Even if you do have a job, the lower paying it is the greater the possibility you will be eligible to file. If you make too much, you have to file Chapter 13 bankruptcy.
The Means Test
The means test is how this eligibility is factored in. It’s important to note that if you have a high paying job but lose it, you may not be eligible for several months. The means tests works like this: your past income for the previous six months is compared to the median income for other Georgians, so if you make $60,000 as an individual, you are over. Now, if you lose your job, it’s wise to wait several months before applying for Chapter 7 relief. This is because your prior income will be factored in, even if the job is gone.
What happens if you’re not eligible for Chapter 7? First off, because of the 2005 changes to Bankruptcy Code, Chapter 13 bankruptcy, which is a debt repayment plan, is now more common for those with higher incomes. If you make too much for Chapter 7, you’re likely eligible for Chapter 13.
Georgia Chapter 7
Filing Chapter 7 bankruptcy has many advantages, namely the fact you can discharge a lot of debt. Even with unemployment benefits, having bills come in for credit cards and medical fees can be daunting. Chapter 7 has the ability to discharge these debts at little cost to you; most who file Chapter 7 in Georgia and elsewhere lose nothing.
If You Need Help
If you have no job, how can you afford to file bankruptcy? Well, Chapter 7 bankruptcy only costs $299 to file, which may seem like a lot, until you see you can discharge tens of thousands. Lawyer fees are typically more, and this can be tough if you have no job. However, it’s crucial to get a specialist in bankruptcy law so you can successfully discharge the most debt and keep all your assets. And though lawyers are never free, an experienced one can save you more money than he or she charges.
