What Would Disqualify Me From Bankruptcy?

Bankruptcy can give you a fresh start by eliminating your legal obligation to repay creditors. However, there are a variety of circumstances under which a court can deny your bankruptcy application. Meaning that even if your assets are few and you think you qualify for bankruptcy, you may not have enough grounds for the courts to approve your bankruptcy request.  If this sounds like it applies to you, we encourage you to contact Arizona Bankruptcy and Debt Solutions today! We will help you better understand what it takes to qualify for bankruptcy so check this if you when I file for bankruptcy.  The following would make you be disqualified from bankruptcy:

Median/High-Income Households

As mentioned previously, not everyone qualifies to file for bankruptcy. To know whether you are eligible, you must fulfill specific criteria in both your income and expenditures. In filing for a bankruptcy petition, you need to have a total household income below the median level in your state. You should also be unable to pay all your monthly living expenses while making court-mandated payments toward any secured debts or child support obligations.

If you do not meet the criteria, your application for Bankruptcy Solutions for Individuals might be denied. When this happens, your creditors might then be able to continue taking steps to collect their debt from you.

You Have Non-exempt Assets

When filing a bankruptcy petition, a court-appointed “trustee” controls all your assets. The trustee will go through a list of everything that they can find and determine what is exempt from being taken by the debt repayment process. For example, if someone owns a vehicle worth $35,000 with an unpaid loan balance of $12,000 on it, the trustee may force them to sell their car and use that equity ($23,000) to pay back their creditors.

Hiding Or Destroying Information

Suppose you’re thinking about filing for bankruptcy. In that case, it’s essential to be truthful and thorough when filling out the forms and answering any questions so that the courts will process your bankruptcy as quickly as possible. It’s also important to back up any assertions made in your schedules with records or proof. The court could delay the bankruptcy process if you are not truthful or destroy or conceal documents that may help the trustee find an undisclosed property. In addition, giving false testimony is a felony punishable by imprisonment.

Failure To Take An Instructional Course

One of the most frequent reasons for a bankruptcy application being rejected is because the debtor failed to finish an educational course on personal financial management. You must complete two instructional courses under U.S. Bankruptcy Code before the court can file your case, and one is required credit counseling that takes place before filing. The second requirement is a financial management course that must be completed within your case and is necessary for you to obtain a discharge. If you fail to complete the course through the entirety of the bankruptcy process, the law courts will deny your request.

Attempt To Cheat

If you’re considering filing for bankruptcy, knowing what the law says about fraudulent transfers is important. When the debtor, with the intent to delay, obstruct, or defraud a creditor, maims, removes, transfers, destroys, or conceals property within one year before the petition date or at any time after that date, it’s considered a common ground for rejecting a bankruptcy application. For instance, if someone transfers their house into their spouse’s name to avoid creditors’ attempts to seize it and then files for personal bankruptcy protection from the same creditors, this is considered a fraudulent transfer that might cause trouble with their application.

When You Don’t File Pre-Requisite Forms And Documents

Many individuals are unaware that submitting a bankruptcy petition necessitates the disclosure of all of their financial details. You’ll need to complete several bankruptcy-related forms, including schedules, a bankruptcy petition, and other needed documents. If you do not submit all the required paperwork, the court of law will disqualify you. In addition, after filing a petition, you must provide supporting documentation to the trustee, including pay stubs, tax returns, and other papers, to cross-check the information in your bankruptcy application. Because each trustee comes with unique demands for supporting documentation, you must understand what is necessary before filing your case.

It’s challenging to plan a bankruptcy, and many people make the mistake of not being entirely truthful. For example, if you fail to disclose modifications in your property or give away assets on the day before you file for bankruptcy, the court may reject your discharge.

When The Court Filing Fees Are Not Paid

When filing for a bankruptcy petition, there is a filing fee required. If you have little or no income, you can apply for a waiver of your court charges. The court will consider your income and expenses when verifying the waiver request. If you do not pay the required filing fees, the law courts will disqualify your petition if you do not provide a waiver.

A waiver of these fees may be granted on a case-by-case basis by an administrative law judge at any point during the proceedings after it has been determined that there are insufficient funds for payment of costs associated with processing the matter through to completion of final judgment. However, it’s important to keep in mind that even if you’re granted a waiver, the court may insist upon payment of future filing fees as your case progresses.

Your Bankruptcy Attorney Is The Key To A Successful Discharge

It’s normal to feel some level of concern about what will happen with your finances–especially if they’re in disarray. The good news is that this won’t necessarily come true; there are many different reasons why someone may not receive a discharge. Most of these can be avoided by talking to the right attorney before moving forward with any legal action.