There is a problem with the bankruptcy Means Test. In my last blog I discussed the November 1st report of a decrease in overall median income for the nation. These new median income figures will apply to those of you seeking relief by filing bankruptcy. The trouble is, the lower the median income the more difficult it is to meet the requirements of the Bankruptcy Code of 2005. In other words, as the mean income decreases your income will have to be lower in order to pass the Means Test. In this way, the bankruptcy Means Test could cause more people to be denied help with Chapter 7 bankruptcy as unemployment rises and salaries decrease.
If you need to file for bankruptcy help and you fail the Means Test, you will have to file a Chapter 13 bankruptcy, which includes a repayment plan. If your income is above the median income, the repayment plan involved in Chapter 13 will last five years. In many cases, the dilemma is that even though the Means Test says you have money available to make the Chapter 13 plan payments, actual income and expense analysis show that there is often little or no funds left after your daily living expenses are paid.
If you live in Denver, Aurora, Arvada, Brighton, Broomfield, Commerce City, Englewood, Highlands Ranch, Lakewood, Lafayette, Littleton, Northglenn, Westminster, Wheat Ridge, or Golden, Colorado, please feel free to contact me. Kevin D. Heupel, Colorado Bankruptcy attorney, 303-955-7570, COBankruptcyHelpEmail, free-consultation form.
