Income Testing for Chapter 7 Bankruptcy If you make over the average income for your size of family, you may be forced to file a Chapter 13 Bankruptcy. If you make under the average income you should be able to file a Chapter 7 or 13 Bankruptcy. If you make in between you may not be able to file either a Chapter 7 or 13 bankruptcy if you don’t make enough to fund the Chapter 13 and you make too much to file a Chapter 7 bankruptcy. Large failure rates for Chapter 13s still exist.
Kentucky Bankruptcy Records By Name
Here are the tables for your state.
A Chapter 13 bankruptcy must be for 5 years if you earn over the average income Prior to this, Chapter 13 bankruptcy cases were often for only 3 years.
Mandatory Debtor Education After 10-2005 you cannot file any bankruptcy without first taking “credit counseling” classes approved by the Trustee’s office similar to taking traffic school. This is your ticket to file bankruptcy. After you file bankruptcy you must also take “Debtor Education” classes in financial management to get a discharge.
No more Chapter 20 bankruptcy filings. Often a person could not afford a Chapter 13. To lower payments, he would first file a Chapter 7 bankruptcy to eliminate unsecured debts and then only pay secured debts in a Chapter 13 to stop a foreclosure. This was Chapter 20. Now you cannot get a Chapter 13 discharge if you file a 7 within the prior 4 years.
Chapter 7 discharge is limited to one every 8 years. This used to be every 6. You cant file a Chapter 13 after a filing a Chapter 7 for 4 years. You cant file a Chapter 13 after a filing a Chapter 13 for 2 if your plan paid 70% or more 6 years if it paid less.. If you file before the time limit, you may be able to file a Chapter 13 in order to stop a foreclosure by curing the arrearage. But you don’t get a discharge and you wont be protected from the other creditors calling or suing you.
Exemptions reduced Several states had their homestead exemptions reduced. The amount and types of property you can keep will be reduced. Kentucky and other states will have huge increases in their home exemption from 5,000 to 18,450 on June 20 2015 to help you keep property.
U.S. Bankruptcy Court
Carl Perkins Federal Building
U.S. District Courtroom
1405 Greenup Avenue, Suite 204
Ashland, KY 41101