Those who struggle through extended periods of financial hardship may feel that pursuing relief from debt concerns could be integral to safeguarding their financial futures. Bankruptcy is an outlet that could help individuals in Mississippi achieve similar pursuits, but some might have questions about what to expect from this process. The means test is a component of Chapter 7 bankruptcy that could have a significant influence on one’s situation and understanding this aspect of the process could be vital to preparing to make informed choices about the available options.
The means test
The means test is a component of bankruptcy that may affect one’s eligibility to pursue relief via similar paths. This test may require individuals to provide detailed information on all sources of income and to compare yearly income with the median income in one’s state. Those who earn less than that state’s median may be eligible to proceed with Chapter 7 bankruptcy filings.
However, that might not mean that those who make more than the median will not be eligible, as there is a second portion to the means test if income exceeds this limit. This part allows one to create a list of eligible expenses and subtract this number from yearly income. Experts state that if the information from this step indicates a debtor would struggle to pay more than a certain portion of debts over a five-year period, he or she may be deemed eligible to file for Chapter 7 bankruptcy.
Seeking advice on one’s options
The means test is just one aspect of the Chapter 7 bankruptcy process and those who are uncertain if this might be a viable path for relief could benefit from seeking advice in evaluating their options. By consulting with an attorney, a person in Mississippi may obtain much-needed guidance in addressing his or her financial situation. An attorney can work with a client in choosing the best path with which to seek debt relief and assist him or her in navigating every stage of this process.