Chapter 7 Bankruptcy Explained by a Panama City Bankruptcy Attorney

Panama City, Fla. – A local bankruptcy law firm in Panama City has supported their local community for the last 21 years and is a leader in the laws of bankruptcy. The firm strives to educate the public in a number of ways to help those struggling under the pressure of financial distress and continues to do so today. The team of Panama City bankruptcy attorneys at Lewis & Jurnovoy, P.A. share how the Chapter 7 Means Test works in Florida.

According to the bankruptcy professionals, in order to file for a Chapter 7 bankruptcy, a family must pass what is known as the “Means Test”. This test is an assessment that considers income, expenses, and outstanding debts that a person has to their name and  whether  they cannot realistically pay off their debts and is used by the courts to determine whether someone is eligible to file for bankruptcy.

For those unsure of what Chapter 7 Bankruptcy is, the law firm also gave a summary. They state,  “Chapter 7 is a section of the federal Bankruptcy Code that provides for outright cancellation of most types of personal debts without a repayment plan and for possible sale of some types of nonexempt property to pay such debts.” 

Several documents are necessary to complete the Means Test. As the Chapter 7 bankruptcy lawyers in Panama City explain, documents such as bills, paychecks, and tax records will need to be submitted. The court will most likely require as much documentation as possible. In some cases, a family will go through the whole Means Test to find out they need to provide more paperwork. The best advice in this regard is to be prepared to provide everything  that potentially could be requested.  

However, not all who undergo this assessment will be approved for Chapter 7. For those who do not qualify, the cause is usually attributed to the courts determining the household income is enough to repay any outstanding loans and debts. Fortunately, there are other measures that a family can take if Chapter 7 isn’t right for them.  

To find out more about Chapter 7 bankruptcy and  the Means Test,  contact the Panama City office of Lewis & Jurnovoy, P.A. today  at  (850) 913-9110 or visit their  website  https://lewisandjurnovoy.com/.