Have you ever heard of the means test? It is a form used in Louisiana and elsewhere to determine Chapter 7 bankruptcy eligibility. Before you can file for this type of debt relief, you have to take this test in order to show that you truly lack the means to meet your debt obligations.
Some common questions about the bankruptcy means test include:
- Where do I get this test from?
- What information is needed to complete it?
- What if, on paper, I make too much?
Obtaining a means test
Obtaining a means test is a simple process. You can ask your legal counsel for the forms or you can generally find them online.
However, getting them from a bankruptcy attorney is probably your best bet. That way you know you have the right documents in hand in order to avoid a lot of hassle down the line.
Taking the means test
To take the means test, it is just a matter of answering questions about your income. You will then compare your income to the state's median income level. You can find all the information you need in your own personal records and state census records.
What do my results mean?
Your test can go one of two ways:
- The first is that your income level will show that you make less than the state's median, meaning you qualify for a Chapter 7 bankruptcy.
- The second is that your income level will be higher than the state's median, meaning a Chapter 7 filing is generally out of the question. However, you may still be able to file Chapter 13 bankruptcy.
What if my income is too high but I still lack the means to pay my debts?
This may qualify as a special circumstance. Courts look at more than just income - they look at disposable income as well. Disposable income is basically the funds you have left at the end of the month after paying all allowable expenses. Your legal counsel can review your current expenses and let you know which actually qualify.
Debt relief is something that many Louisiana residents desire. No one likes the feeling of being in a financial hole from which they cannot escape.
Pursing a Chapter 7 bankruptcy filing or other debt relief options can alleviate the stress you feel from not being able to meet your financial obligations. An experienced bankruptcy attorney can assist you in taking the debt relief actions that will best serve your interests.