Are There Any Prerequisites for Filing for Bankruptcy?
What’s Happening


“We’ve Been Helping People from Merrillville and Northwest Indiana Get Out of Debt for 20 Years”

Are There Any Prerequisites for Filing for Bankruptcy?

Are There Any Prerequisites for Filing for Bankruptcy?
February 15, 2017

A Griffith Bankruptcy Attorney Is Ready To Help

If you are struggling to pay off large amounts of debt, you may be wondering whether or not filing for bankruptcy is a smart idea. However, before you rush into filing for bankruptcy, it is important to know when filing for bankruptcy is appropriate and what requirements you need to satisfy before filing.

Requirements for Filing for Chapter 7 Bankruptcy

In order to file for Chapter 7 bankruptcy, there is a list of criteria that you must satisfy. This includes, but is not limited to:

  • Being an individual, a partnership, or another business entity;
  • You pass the “means test”; and
  • You receive credit counseling from an approved credit counseling agency prior to filing.

What is the Means test for Chapter 7 Bankruptcy?

You must pass a “means test” if your monthly income is more than the median income in the state. This means test considers:

  • Your monthly income over the course of the past five years; and
  • Whether or not you have enough disposable income to pay off a portion of your unsecured debts.

If you do not have a enough disposable income to pay off a portion of your debts, then you will likely be eligible to file for Chapter 7 bankruptcy. If you do have enough income, then you will likely need to file for Chapter 13 bankruptcy.

Requirements for Filing for Chapter 13 Bankruptcy

Like Chapter 7, there are also a handful of requirements to file for Chapter 13 bankruptcy. This criteria includes:

  • You must be an individual – businesses are not allowed to file for Chapter 13 bankruptcy;
  • You must receive credit counseling from an approved credit counseling agency; and
  • Your unsecured debts must be less than $383,175, and your secured debts must be less than $1,149,525.

Which Type of Bankruptcy Should I File for?

Not only are the requirements for the two different bankruptcy types very different, but so are the effects. In Chapter 13 bankruptcy, you will work with your creditors to develop a payment plan in which you continue paying off your debt for a period of time; in exchange, you will be allowed to keep the majority of your assets. In Chapter 7 bankruptcy, most of your debts are discharged, but you have to liquidate your assets to pay off your credits. Which type of bankruptcy you should file for, and the regulations for each, can be confusing – working with an attorney is advised.

If you have more questions about filing for bankruptcy or which type of bankruptcy for which to file, do not hesitate to contact an experienced attorney. At the Whitten & Whitten, P.C, our attorneys in Indiana have more than two decades of experience, and will go to work for you. A consultation with our office is always free!




Schedule A Free Consultation

At Whitten & Whitten, we offer a free consultation during which we will examine the facts of your case and advise you on how best to proceed

  • 9 + five =
  • This field is for validation purposes and should be left unchanged.

We are a debt relief agency. We help people file for bankruptcy relief under the bankruptcy code. This information is designed for general information only. The information presented should not be construed to be formal legal advice nor the formation of a lawyer/client relationship. Past results and testimonials are not a guarantee, warranty, or prediction of the outcome of your case, and should not be construed as such. Past results cannot guarantee future performance. Any result in a single case is not meant to create an expectation of similar results in future matters because each case involves many different factors, therefore, results will differ on a case-by-case basis. By providing certain contact information herein, you are expressly authorizing the recipient of this message to contact you via the methods of communication provided.