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What Happens If I Fail the South Carolina Bankruptcy Means Test?

What Happens If I Fail the South Carolina Bankruptcy Means Test?

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As we’ve discussed in previous articles, if you plan to file bankruptcy in South Carolina, you must take a bankruptcy Means Test. You can either do this on your own or engage the services of a bankruptcy attorney. If after taking the Means Test you do not qualify for Chapter 7 bankruptcy, your bankruptcy lawyer will likely encourage you to explore alternative options such as Chapter 13 bankruptcy. However, there are also other approaches that can help overcome a failed Means Test.

After carefully considering your income, expenses, and overall financial situation, your bankruptcy lawyer may suggest exploring the options of refinancing a home, selling a car, or negotiating with creditors to reduce monthly bills. A bankruptcy attorney can assist in evaluating your financial situation and determine if there are any legal strategies that might enable you to pass the Means Test.

Failing the South Carolina bankruptcy Means Test can be a frustrating and overwhelming experience. However, individuals must not give up hope. You can explore all of your options with the assistance of an experienced bankruptcy attorney. At the Drose Law Firm, our bankruptcy lawyers understand the complexities of the bankruptcy process and will guide you through your options. If you plan to file bankruptcy, Charleston residents and individuals throughout South Carolina have been utilizing us for more than three decades to handle their debt resolution cases. Are you ready to stop creditors from calling and free yourself of the stresses associated with being in debt? If so, give us a call to schedule a consultation today.

Stopping Foreclosure Action

Stopping Foreclosure Action

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Can I save my house if the mortgage holder has started a foreclosure action?

As long as there has not been a foreclosure sale, even after foreclosure paperwork has been sent to you, the foreclosure action would be stopped with the filing of the bankruptcy case, and the mortgage default could be made up.  If you are able to formulate a plan that meets the tests below, and would provide for resuming the payments and making up the default, then a Chapter 13 filing would still save the house.

There are really four tests that are used by courts in deciding whether to confirm a Chapter 13 plan.  The Debtor needs favorable rulings on all of the following issues, and may have other criteria to consider:

  • Are the unsecured creditors getting as much over the life of the plan as they would have received if the Debtor had filed a Chapter 7 and non-exempt property was sold?
  • Does the plan pay all secured creditors in full, plus interest, to the extent of the value of collateral, and pay all past due support and taxes in full?
  • Does the monthly amount equal the amount available from all of the Debtor’s income after reasonable expenses, for at least three years?
  • Does the overall effect of the plan suggest the Debtor is acting in good faith?
  • The Debtors sometimes have to propose more than one plan in order to convince the trustee and the Court that the plan meets all of the criteria above.

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