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Bankruptcy

When Should You File for Bankruptcy?

Filing for Bankruptcy

Filing for bankruptcy is a significant financial step, one often made as a last resort. But is it possible that filing for bankruptcy could be a smart choice for reasons beyond simply wiping out debt? Here is one possibility for seniors who would like to wipe out a portion of their outstanding debt using a Chapter 13 filing since income such as Social Security and assets such as 401(k)s and some life insurance are protected: http://www.thestreet.com/story/13177003/1/why-some-retired-people-might-consider-filing-for-bankruptcy.html

But in the fear that a bankruptcy filing could be taken advantage of by those who can actually afford to pay off their debts, the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) introduced a “means test” for debtors. The goal is to use income thresholds and other calculations to determine whether someone is eligible to file for Chapter 7 bankruptcy (liquidation) or if they have a high enough income for a court to order a Chapter 13 (reorganization) filing. Read more about means tests here: http://asianjournal.com/immigration/chapter-7-and-13-bankruptcy-means-test/

If you’re thinking about filing for bankruptcy, you need to consult with a bankruptcy attorney as soon as possible. Only an attorney experienced enough with the bankruptcy process will be able to effectively help you through every step of the way and give you exactly the information you need, when you need it. Contact one of our bankruptcy attorneys at The Brad Hendricks Law Firm in Little Rock today for a consultation: (501) 221-0444.