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.

Fail The South Carolina Bankruptcy Means Test

What Factors Would Cause Me to Fail The South Carolina Bankruptcy Means Test?

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Filing for bankruptcy in South Carolina is a complex and challenging process, which is why many people consult with a bankruptcy attorney to discuss their situation. As we’ve discussed in previous articles, before filing bankruptcy, you must first pass the South Carolina bankruptcy Means Test to determine your eligibility for Chapter 7 bankruptcy. Your bankruptcy lawyer will facilitate the Means Test which compares your income to the state’s median income to determine if you have enough disposable income to repay your creditors.

The Means Test examines your monthly revenue for the six months preceding your bankruptcy filing. This includes all forms of income such as salaries, dividends, etc. Then, certain priority debts such as alimony, child support, and taxes are deducted from your monthly income to determine your disposable income.

Reasons for failing the Means Test include:

High Income or Expenses

If your individual income is higher than South Carolina’s median income level for your household size, you may fail the means test. In addition, if your necessary expenses such as mortgage payments, car payments, and other bills are too high, it can push your disposable income over the threshold.

Errors or Mistakes

Filing the Means Test requires detailed information. Even a simple clerical error can throw off the results. Miscalculations of income, expenses, or debts can result in an inaccurate assessment of the individual’s income and their eligibility for bankruptcy.

If you plan to file bankruptcy, Charleston residents and those in surrounding areas have trusted the bankruptcy attorneys at the Drose Law Firm to conduct the South Carolina bankruptcy Means Test and handle their bankruptcy filings. If you plan to file bankruptcy now or in the future, our bankruptcy lawyers are here to help. Give us a call to schedule a consultation today.

Understanding Your Expenses for the Means Test

Understanding Your Expenses for the Means Test

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As we have discussed in previous articles, one of the first orders of business when you hire a bankruptcy attorney is to conduct what is referred to as a “Means Test.” Your bankruptcy lawyer will use the Means Test to determine whether you qualify to file for Chapter 7 bankruptcy. It’s important to note that if you do not qualify for Chapter 7 – which discharges debt – your bankruptcy attorney will likely recommend Chapter 13 bankruptcy, which re-organizes debt.

The Means Test considers both your “necessary” expenses and your “discretionary” expenses. Our previous article covered examples of what are considered necessary expenses. Today, we will look at examples of what may be classified as discretionary expenses when it comes to the Means Test.

Entertainment

This may include items such as movies, books, magazines, recreation, and hobbies.

Personal Care

This may include haircuts/styling, nails/manicures/pedicures, cosmetics, etc.

Gifts

This may include holiday gifts, birthday gifts, anniversary gifts, etc.

Savings

This may include money in a traditional savings account, retirement savings, emergency fund savings, etc.

When filing bankruptcy, Charleston residents and those in surrounding areas have sought the services of the Drose Law Firm to assist them with their bankruptcy filings. The bankruptcy lawyer at Drose Law Firm has been handling debt resolution cases for more than 30 years. If you plan to file bankruptcy, consider engaging a bankruptcy attorney who is familiar with the process. Give Drose Law Firm a call to schedule a consultation today.

Calculating Your Expenses for the Means Test

Calculating Your Expenses for the Means Test

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When you engage a bankruptcy attorney to handle your bankruptcy case, you will be subject to a Means Test to determine if you qualify to file for Chapter 7 bankruptcy. Your bankruptcy lawyer will ask you to gather some information about your monthly expenses. This includes both your necessary and discretionary expenses. You will need to provide documentation of your expenses, such as receipts, bills, or bank statements.

What expenses are considered “necessary” and which ones are considered “discretionary?” Your bankruptcy attorney will discuss these in regard to your specific circumstances, but we can take a peek at each of these in general. Today, we will look at what are considered “necessary” expenses:

Housing and Utilities

This includes your mortgage or rent, as well as any property taxes and insurance. You will also need to include any utility bills, such as electricity, gas, water, and sewage.

Transportation

Car payment, car insurance, and gas expenses. If you use public transportation, you will need to include those expenses as well.

Food

Groceries and any other food-related expenses such as dining out.

Childcare

If you have children who require childcare in order to work, you will need to include those costs here.

Medical:

This includes any medical or dental bills that you have incurred. It also includes health insurance premiums.

Other Necessary Expenses:

This may include items such as clothing, education costs, and pet care.

Our next article will cover “discretionary” expenses.

If you filing bankruptcy, Charleston residents and individuals throughout South Carolina have turned to the Drose Law Firm for assistance. Our bankruptcy lawyer handles solely debt resolution cases and has been doing so for more than three decades. Considering filing bankruptcy? If so, give us a call to schedule a consultation with our bankruptcy attorney today!

What is a Bankruptcy “Means Test”

What is a Bankruptcy “Means Test”

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One reason people choose to hire a bankruptcy lawyer is because the process to file is complicated and can be quite confusing. For instance, not everyone qualifies to file Chapter 7 bankruptcy as certain criteria must be met. The “Means Test” determines if you are eligible to file for Chapter 7 bankruptcy. Your bankruptcy attorney can explain this further, but here is a summary:

The first part of the Means Test examines your household income and compares it to the median income for a household of your size in South Carolina. If your household income is below the median income, you will automatically qualify for Chapter 7 bankruptcy. If your household income is above the median income, you will need to complete the second part of the Means Test, which looks at your disposable income.

Disposable income for purpose of the Means Test is defined as your monthly income after subtracting certain allowed expenses, such as taxes and child care costs. If your disposable income is less than $100 per month, you will qualify for Chapter 7 bankruptcy. To complete the second part of the Means Test, you will need to provide your bankruptcy lawyer with the following:

  • Your most recent federal tax return
  • Your pay stubs from the last six months
  • A list of all of your debts
  • A list of all of your assets
  • Any other documents requested by your bankruptcy attorney.

Our next article will answer some common questions about the Means Test.

If you are considering bankruptcy, Charleston residents and those in surrounding areas trust the bankruptcy lawyer at the Drose Law Firm to help guide them through the process. Some law firms have multiple practice areas (i.e., auto accidents, malpractice, criminal, civil, etc.) At Drose Law Firm, our bankruptcy attorney only handles debt resolution and has been doing so for more than three decades. Give us a call to  schedule a consultation with our bankruptcy lawyer today.

What to Expect When Filing Chapter 7 Bankruptcy

What to Expect When Filing Chapter 7 Bankruptcy

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We are continuing our series of articles discussing what to expect when filing Chapter 7 bankruptcy. Our previous articles gave an overview of what Chapter 7 bankruptcy is and explored the actual filing process. We also covered how you and your bankruptcy lawyer will be required to meet with your creditors before receiving the final discharge order. Today, we will look at what else to expect when filing Chapter 7 bankruptcy.

Credit Rating

Unfortunately, filing Chapter 7 bankruptcy will significantly damage your credit for up to 10 years. You may still be able to obtain credit, but it will be more costly (i.e., higher interest rate) and limited (i.e., lower credit limit). Your bankruptcy lawyer can suggest some strategies to help you re-build your credit after filing Chapter 7 bankruptcy.

Hiring a Bankruptcy Attorney

Filing bankruptcy can be quite complicated, so if you are considering filing Chapter 7, you may wish to hire an experienced bankruptcy attorney to help navigate the process. A bankruptcy attorney can file the paperwork, attend creditor meetings, provide suggestions on how to re-build your credit, and deal with any associated red tape.

It is often stressful for individuals to consider filing bankruptcy. Charleston residents and those in surrounding areas engage Drose Law Firm because our bankruptcy lawyer only handles debt resolution. If you are considering bankruptcy, we welcome the opportunity to talk with you. Give us a call to schedule a consultation with our bankruptcy attorney today.

What Can I Expect When I File Chapter 7 Bankruptcy?

What Can I Expect When I File Chapter 7 Bankruptcy?

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One of the first questions clients ask our bankruptcy attorney is what can they expect when they file Chapter 7 bankruptcy. This series of articles covers some of the basics about Chapter 7 bankruptcy. Our previous article covered how bankruptcy lawyers should go over the different types of bankruptcy with their clients, including providing and overview of Chapter 7. They should also discuss what the process of filing Chapter 7 bankruptcy entails. Here are a few more things you can expect:

Meeting with Creditors

A trustee will be appointed by the court to supervise your bankruptcy. You will then need to meet with your trustee and creditors an answer questions about your debts and property. Your bankruptcy lawyer will be present at this meeting.

Discharge Order

After the bankruptcy has been filed and you’ve answered all questions from the trustee and your creditors, your case will continue to be reviewed. If there are additional questions or concerns, those will need to be addressed by your bankruptcy lawyer on your behalf. Once all the requirements have been met to the satisfaction of the court, you will receive a discharge order which relieves you from your unsecured debt.

When represented by a bankruptcy attorney, a discharge order in many cases can be granted in approximately three months. If you have a lot of property or extenuating circumstances, the process could take longer. Drose Law Firm has spent more than three decades handling cases involving bankruptcy. Charleston residents and those in surrounding areas turn to our bankruptcy lawyer for their debt resolution and debt settlement needs. Give us a call to schedule a consultation today.

What Happens in a Chapter 7 Bankruptcy?

What Happens in a Chapter 7 Bankruptcy?

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When someone comes to our office to meet with our bankruptcy attorney, many times they ask about what exactly happens during the Chapter 7 bankruptcy process. There are many myths about bankruptcy, and our bankruptcy lawyer takes time to help our clients understand all of the options available to them. Our next series of articles will discuss what happens in a Chapter 7 bankruptcy. Let’s get started:

Overview of Chapter 7

Chapter 7 bankruptcy is designed to provide a debtor relief from debts owed to creditors. It is different from Chapter 13 bankruptcy, which essentially re-organizes debt into a structured plan to pay. In the case of Chapter 7, all qualifying debts may be completely discharged.

Qualifying for and Filing Chapter 7

A debtor must meet a certain set of requirements to qualify for filing Chapter 7 bankruptcy. A bankruptcy attorney can help a debtor determine whether or not they are qualified. If they are qualified to file Chapter 7, then the bankruptcy lawyer will move towards preparing the actual filing. This is a petition to the court which includes a comprehensive and detailed list of all the debtors property, debt, and creditors.

Our next article will outline more details about filing Chapter 7 bankruptcy.

When considering bankruptcy, Charleston residents and those in surrounding areas who need a trusted bankruptcy attorney may choose to engage Drose Law Firm. Our bankruptcy lawyer handles all types of bankruptcies and debt resolution cases. We have been in business for more than three decades and will be here to serve you if you need us. Give us a call to learn more today.

What Items and Income Are Exempt from Bankruptcy?

What Items and Income Are Exempt from Bankruptcy?

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What Items and Income Are Exempt from Bankruptcy?

We are continuing our series of articles discussing the various types of items and income that may be exempt from bankruptcy in South Carolina. Our previous articles discussed equity in your home, personal property, retirement accounts, and equity in your automobile. While only an experienced bankruptcy attorney can advise you of what is exempt in your case, here are more types of items and income that may qualify for exemption.

Professional Tools and Equipment

If you have specific tools and/or equipment that you need and use to perform your work, then these may qualify for exemption. Examples include commercial tractors, lawn mowers, welding equipment, books, computers, telephones, and any other professional equipment you use to earn income. If you have any tools of the trade that you think may qualify, be sure to disclose these to your bankruptcy attorney.

Alimony and Child Support

If you are receiving any alimony or child support, this is exempt from your bankruptcy filings. Once again, be sure to disclose all alimony and/or child support payments you receive to your bankruptcy lawyer.

Many people think that filing bankruptcy means losing everything. That is simply not the case. A bankruptcy lawyer can help you navigate through the difficult process and advise you of what assets you may be able to retain. When it comes to filing bankruptcy, Charleston residents and those in surrounding areas have trusted Drose Law Firm for more than three decades. Our bankruptcy lawyer handles debt resolution, debt settlement, and foreclosure resolution cases, including IRS debt resolution. Give us a call to schedule a consultation with our bankruptcy attorney today.

Bankruptcy Exemptions in South Carolina

Bankruptcy Exemptions in South Carolina

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Bankruptcy Exemptions in South Carolina

We are continuing our series of articles highlighting the different types of assets that may be exempt from bankruptcy under South Carolina law. Our previous article discussed the importance of disclosing all of your assets, equity, real estate, property, retirement accounts, etc. to your bankruptcy lawyer. We also covered how a portion of the equity in your primary residence and some personal property such as household goods, clothing, appliances, jewelry, etc. may also be exempt. Today, we will look at two more areas that may be protected when filing bankruptcy.

Some Retirement Accounts

It is important to disclose all of your retirement accounts and assets to your bankruptcy attorney as some types of tax-exempt retirement accounts and pension funds can be protected from bankruptcy. Your bankruptcy lawyer will review your retirement portfolio, retirement accounts, and pension and advise what can be exempt.

Equity in Your Automobile

If you have equity in your primary motor vehicle that you use for transportation, then either a portion or all of the equity may be protected from bankruptcy. Be sure to disclose to your bankruptcy attorney all of the motor vehicles that you own and/or are in your name.

Our next article will cover more types of assets that may qualify for bankruptcy exemption.

If you are considering filing bankruptcy, we can help. Our bankruptcy attorney has been handling debt resolution cases in South Carolina for more than 30 years.  We understand how difficult it can be to file bankruptcy. Charleston residents and those in surrounding areas have trusted Drose Law Firm to help them reclaim their financial freedom. Give us a call to speak with our bankruptcy lawyer today.