Chapter 7 bankruptcy is one of the simplest types of bankruptcy to file. This does not, however, guarantee that your bankruptcy will go off without a hitch—especially if you attempt to file on your own. Here are some of the most common reasons bankruptcy might be rejected. Contact Law Offices of Terrence Fantauzzi at (909) 552-1238 to request a free legal consultation with an experienced bankruptcy attorney.
You failed to pass the means test
Bankruptcy under Chapter 7 is a great approach to get rid of unsecured obligations like credit card debts. However, because the filing procedure is subject to a means test, it is not open to everyone. This means test is intended to discourage people from filing for Chapter 7 bankruptcy when they have adequate assets or disposable income to cover their obligations but want to skip payments in order to maintain a high quality of life. It’s quite simple to make a mistake while calculating your means, which might lead to your Chapter 7 application being refused.
Your timing is incorrect
Certain time limits must be addressed while filing for bankruptcy. For example, if you have previously filed for Chapter 7 bankruptcy, you will not be able to apply for another one for another 8 years. You should also avoid filing too soon after making a significant credit card purchase or repaying a loan to a family member or other “preferred creditor.” Any missed deadline, even by a day or two, might jeopardize your whole bankruptcy process.
You’ve made a blunder with your paperwork
Your whole bankruptcy petition may be dismissed if you fail to mention even one asset or valued item, or if you leave even one creditor out of your file. It doesn’t matter whether the omission was an honest error in the eyes of the court; you’ll still be refused.
You haven’t kept track of your tax returns
When people are having financial difficulties, they frequently encounter problems with the IRS. They could not have any formal income or have so little that they don’t bother to file their taxes. Because you must produce your records for the bankruptcy trustee’s inspection, this might be a major stumbling block for your bankruptcy file.
Someone raises an objection to your filing
A creditor or the bankruptcy trustee may choose to contest your file for a variety of reasons. Typically, challenges arise from accusations that you sought to conceal assets, make misleading financial declarations, or otherwise mislead the court or misuse the bankruptcy process.
Don’t take the chance of being rejected – consult a bankruptcy lawyer
When you’re in need of financial assistance, any delays may be devastating, so do everything you can to have your application granted the first time. The good news is that by engaging a bankruptcy attorney can help you avoid these issues. Contact Law Offices of Terrence Fantauzzi at (909) 552-1238 for a free legal consultation.