California Bankruptcy Lawyer Blog

A California bankruptcy attorney explains means test calculators and how they can affect your bankruptcy filing.

A debtor who is considering bankruptcy may want to see if she has the means to avoid going through Chapter 7 or Chapter 11. Because there is an expense involved with filing the paperwork and hiring a lawyer, you may choose to avoid attempting to declare bankruptcy if it is at all avoidable.

Where Can I Find a Means Test Calculator?
A number of programs exist to find a means test calculator if someone wants to have the code on their computer. Several websites offer means test calculators.

Are Some Programs Better?
The underlying code to calculate whether a person has the means to avoid declaring bankruptcy does not change much from year to year. As long as the person who wrote the code did a decent programming job, any means test calculator should work well when providing a guideline.

Does It Have to Be An Online?
If a person does not want to use an online program, he can run the numbers by himself if he knows the processes and the formula. He will also need copies of his bills so that he can crunch the numbers.

If you would like more information on this topic or other bankruptcy topics, please contact one of our California offices at 1800.941.6730. We at Sagaria Law can connect you with one our our experienced California bankruptcy attorneys. We have bankruptcy attorneys located throughout California and Oregon to assist you with your bankruptcy questions. If you need assistance regarding a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, a cram down, stopping a foreclosure or wage garnishment, asset protection, discharging debt, etc. we can help! Please contact us to receive a free consultation or visit our website at www.sagarialaw.com to request an in-person consultation with an experienced bankruptcy attorney. We have an exceptional team of bankruptcy lawyers, bankruptcy client care specialists and bankruptcy staff supporting California.

A San Jose bankruptcy attorney talks about the Role of the Means Test in Bankruptcy...

The role of the means test is determined by the Chapter under which you are filing, be it Chapter 7, Chapter 11, or Chapter 13. In any event, the means test is a determination of your “Current monthly income.”

In a Chapter 7, the means test is used to determine whether the filing is abusive. Specifically, in 2005, the law changed to require that people demonstrate that their bankruptcy was, essentially, legitimate. To do this, debtors fill out a complex questionnaire (the means test) which determines whether they are making either less than the average income for their state of residency or whether their expenses are such that the debtor is, effectively, in the red every month. If the means test yields an abusive result, the only real option is to file for a Chapter 13, instead (or go through the difficult task of getting the court to overlook the abusiveness).

In a Chapter 13, the role of the means test is to determine how much disposable income the debtor has. This amount then basically becomes the monthly payment that is funded during the repayment period (between three to five years).

In a Chapter 11, the means test is part of a grouping of disclosure documents regarding income and expenses, created for the benefit of the creditors and the court.

If you have a question regarding Bankruptcy in San Jose please contact us at 408.279.2288 or visit www.bkanswers.com and we can connect you with one of our experienced San Jose Bankruptcy Attorneys.  After you have spoken with one of our San Jose bankruptcy attorneys we can schedule you a free face to face appointment in our office location nearest you.  Our team of San Jose Bankruptcy Lawyers can assist you with all aspects of your case. If you have questions about filing a chapter 7 bankruptcy, a chapter 11 bankruptcy, a chapter 13 bankruptcy, lien stripping, cram down,  stopping a foreclosure or wage garnishment, discharging debt, etc. we can help! We have bankruptcy attorneys located throughout California who can assist your financial needs.  Please feel free to complete our free bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy.