There are really two issues in your first question: (1) exemptions and (2) whether you qualify to file Chapter 7 bankruptcy. Exemptions refers to how much property you can protect, and how much you can or cannot protect does not affect your eligibility to file bankruptcy, it simply affects whether you will lose property to the court when you do file. Whether you qualify to file depends on several factors, such as whether your income qualifies under the Means Test
, whether you have filed a previous bankruptcy case too recently, whether you have debts which cannot be discharged in Chapter 7 (thus making Chapter 13 a better idea), etc.
I will start with exemptions: In Texas, you are allowed to protect the items listed HERE
. Texas also allows you to use the federal supplemental exemptions, HERE
. If you have property in excess of the amounts you can exempt, it does not mean you do not qualify to file, it just means if you do file, the court can take the un-exempt property and sell it to give the money to your creditors. In other words, if you have un-exempt property, you will still successfully wipe out your unsecured debt, you just may have to lose some property to do it.
Now, on to whether you qualify to file bankruptcy. The first thing to look at is your income based on your household size. You can go HERE
to select your state and family size, then you look at the chart to see how much combined gross income your family has made in the preceding full 6 months (i.e. if you plan on filing bankruptcy in September 2009, you look at your gross income from March 1, 2009 through August 30, 2009). If your total combined gross income is below the amount on the chart for your family size, you meet the initial threshhold to file Chapter 7. If you are over, then you have to fill out the whole Means Test form, which is very complicated. Trying to explain how to do it here is like trying to explain how to file a corporate federal tax return, so I doubt if we could really successfully do that. A much easier way is to go to an online means test site and start plugging in numbers. You can find one HERE
Other considerations to think about to determine if you qualify to file Chapter 7 include: if you have filed another bankruptcy case too recently. You cannot file a Chapter 7 within 8 years of the filing date of a prior Chapter 7 or within 6 years of the filing date of a prior Chapter 13 (basically). Also, some debts can be discharged in Chapter 13 that cannot be discharged in Chapter 7, such as divorce property settlements. So, if you were ordered in a divorce decree to pay some credit card that has an ex-spouse's name on the card, and you file Chapter 7, the credit card company will go after the ex-spouse, and the ex-spouse can then drag you back to divorce court for contempt of court and you will still have to pay the credit card even though you discharged it in Chapter 7. However, Chapter 13 discharges divorce obligation property settlements, so under this same scenario in Chapter 13, the ex-spouse would be stuck paying the credit card. This is not true of child support, which is never dischargeable under any chapter of bankruptcy. Another consideration is if you have lived in the state long enough to file there (91 days), and then if you have not lived in that state at least 2 years, you may have to use exemptions from the prior state in which you lived.
These issues can get complicated, so I suggest discussing them with your attorney.
Cost varies dramatically from state to state and even attorney to attorney. The average fee amount across the county for Chapter 7 is around $1,500, and the filing fee you pay the court is $299. You also have to get the credit counseling certificate which cost around $50. Again, this may be way off where you live though.
I hope this helps and a positive feedback is always appreciated if this was useful to you.LEGAL NOTICE: I am only licensed to practice law in certain state(s) and I cannot give legal advice to someone who does not reside in a state in which I am licensed, nor shall anything I say in the above answer or elsewhere on this site be deemed legal advice, even to someone who resides in a state in which I am licensed. Fees I receive for answering questions are paid for information, not for legal advice. This forum is designed to provide general information only, and information herein is not warranted to be correct or applicable in any way since laws may have been misinterpreted herein, since laws change from time to time, and since the impact of those laws on any particular situation varies. The information presented in this site shall not be construed to be formal legal advice nor the formation of an attorney-client relationship. Persons accessing this response are encouraged to seek independent legal counsel in their jurisdiction for guidance regarding their individual circumstances. Do not take any action or inaction based on information presented herein since it is informational and may not be accurate or applicable to you; it merely attempts to give you a basis of knowledge to help you formulate questions to ask a legal or other professional in a face-to-face meeting in your jurisdiction. Joseph Ross does not hold himself out to be a specialist or expert in any area, regardless of assertions made by any third party, and any implication of being an expert or specialist herein is made in error. I hope the information presented above is useful to you. Answer above is (c) Joseph Ross. All rights reserved.