In order to qualify for Chapter 7 Texas bankruptcy, you must pass something known as the “means test.” Simply put, the means test is a metric for determining whether your income is low enough that you cannot pay your debts. The means test is the first step toward determining whether you qualify for Chapter 7 bankruptcy.
The means test was devised in order to ensure that only those who are truly in desperate financial straits are eligible for the powerful protections afforded by Chapter 7 bankruptcy. It consists of a few simple steps.
First step is to determine whether your income is below the median income for the state of Texas. If so, you automatically qualify to file for Chapter 7 Texas bankruptcy and do not have to worry about the remainder of the means test. If not, you must determine your amount of disposable income, which then determines your qualifying status for Chapter 7 bankruptcy. There are means test calculators for every state available on the internet which will help you do the calculations for this step.
Qualifying for Chapter 7 Texas bankruptcy does not automatically mean that filing Chapter 7 is the best option for you. Everyone’s financial picture is different, and it is always smart to consult with a bankruptcy lawyer prior to taking any steps. A qualified Dallas bankruptcy lawyer will help you determine how to approach your debt from the best possible angle. Chapter 7 bankruptcy is only one of a number of options at your disposal.