Who Is Eligible to File Chapter 7 Bankruptcy?
There are barriers to filing for Chapter 7 bankruptcy protection and receiving the benefits of a financial fresh start and putting an end to harassing creditors, and wage garnishments. Requirements for filing a Chapter 7 bankruptcy include:
- Within the last 180 days you completed a credit counseling course on the internet, on the phone, or in person from a counseling agency approved by the Court;
- The state in which you are filing must have been your place of residence for the previous 90 days. If you have not resided in the state for 90 days then you may file in the state where the majority of your assets have been located for the last 180 days or where your principal of business is located;
- You filed a bankruptcy that was dismissed within the last 180 days for (1) a failure to obey orders of the court or a failure to make an appearance before the court, or (2) requesting a voluntary dismissal after a creditor asked the Court for relief from the automatic stay;
- Not having filed a Chapter 7 within the last 8 years where a discharge was received;
- Not have received a discharge in a Chapter 13 filed within the last 6 years. This does not apply if you paid 70% or more to unsecured creditors in your Chapter 13 Plan;
- Your income over the last 6 months is below median for your county OR your average monthly income over 6 months after deducting for allowable expenses is not enough to pay 25% of your debt over the next 5 years;
- Not be a railroad, a financial institution, or an insurance company.
The rules for who can and cannot file a Chapter 7 are found in the bankruptcy code. Even if you fail to meet one or more of the requirements, you may still be able to receive bankruptcy protection by filing under a different chapter, like Chapter 13.
