Qualifying for a Chapter 7 or 13 Bankruptcy

You qualify for filing a Chapter 7 bankruptcy if your monthly expenses equals or exceeds your income with nothing left to pay into a Chapter 13 bankruptcy.    In the Western District of Kentucky, Bankruptcy Court, you can now file a Chapter 13 bankruptcy and repay  10%, or less, of what you owe.  Click on this link to download a spread sheet to prepare your Chapter 13 or 7 expenses.  This is the link to the average allowed for Chapter 13 expenses.

Prior to 2003, debtors were required to repay 70% in Chapter 13 cases.  If a debtor files a Chapter 13 bankruptcy that repays 70% the debtor still gets the presumption of good-faith.  Chapter 13's are more affordable have greater benefits, and cost less than debt counseling, but require you to pay whatever disposable income you have into the plan.

If you have no assets to give to the court and all of your property is exempt, filing a Chapter 7 bankruptcy may be better than filing a Chapter 13 bankruptcy.  However, a Chapter 13 bankruptcy does have certain advantages. It will stop a foreclosure and allow you to cure an arrearage. A Chapter 7 bankruptcy will only temporarily stop  foreclosures.  In a Chapter 7 bankruptcy, you normally repay nothing and you probably have nothing to lose.  For your benefit, we have made a table and an Excel Spreadsheet that you may download.

Listing your Expenses on this form should save you time and money in deciding if a Chapter 7 bankruptcy filing is right for you.    To save time, prepare your Chapter 13 bankruptcy online.

The Bankruptcy Manual fully discusses how to qualify for a Chapter 7 or 13.  Download your free copy.