By keely aouga
Often used as a last resort, filing for bankruptcy helps people who can no longer pay their debts get a fresh start by liquidating assets or creating a repayment plan.
Based on the type of bankruptcy that an individual or company files for, you will be absolved from their debt or be forced to liquidate your assets.
However, not everyone is qualified to file for bankruptcy. We’ve put together a list of disqualifiers for filing.
For Chapter 7 bankruptcy, applicants must pass a test to prove they lack enough disposable income to repay their debts. If your income exceeds the threshold, you may not qualify.
The amount of time between your last bankruptcy charge determines whether you are eligible to file again. For example, for Chapter 7, you must wait eight years from a previous discharge.
Skipping the federally required completion of a credit counseling course automatically disqualifies your application.
If your income is too high relative to your debts, the court may determine that you're not eligible to restructure your debts under this chapter.
Concealing assets, making fraudulent transfers within one year of filing, destroying financial records or lying on bankruptcy forms will typically disqualify your case.
If you don't qualify for bankruptcy, there are alternative strategies that can help you manage or reduce your debt
Consolidating your debt into one loan or liquidating your assets are two options. These strategies allow you to pay off your debt in the simplest way possible.