- October 15, 2012
- Posted by: Richard Feinberg
- Category: Types of Bankruptcy
There is much about the Tampa bankruptcy process that may be confusing for debtors. With all of the rules about qualification and requirements, many people simply don’t have an understanding of what to expect.
The First Step
In order to begin the bankruptcy process, you will be required to pass a means test. The means test is an evaluation of your income against the median income level in your state; in this case, Florida. If your income is less than or equal to the median income level, you will be eligible to file for Chapter 7 bankruptcy. If your income is greater than the median income level, you will not be eligible for Chapter 7; but may file for Chapter 13.
The purpose of this test is to prevent abuse of the bankruptcy system. Since debts are satisfied through liquidation of non-essential assets and/or being written off by creditors, the debtor pays very little, if anything, out of pocket. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 was created to ensure that only those experiencing a financial hardship significant enough to prevent repayment are granted the help offered under a Chapter 7 bankruptcy.