Chapter 7 Bankruptcy Information
You may have heard about some of the recent changes in bankruptcy law. While creditors were able to pass legislation that creates additional requirements for a bankruptcy discharge, many people still qualify for Chapter 7 bankruptcy—complete relief of debts.
The first step in figuring out if you qualify for Chapter 7 bankruptcy is to take a look at your income for the past 6 months. We will need to determine if you and your family are above or below the median income based on the last six (6) months of gross income.
Locate your family size on the chart below. The median income for Ohio residents is as follows:
| Household Size | Annual | Monthly |
| 1 | $41,873 | $3489 |
| 2 | $52,216 | $4351 |
| 3 | $61,772 | $5148 |
| 4 | $73,301 | $6108 |
| 5 | $80,201 | $6683 |
| 6 | $87,101 | $7258 |
| 7 | $94,001 | $7833 |
| 8 | $100,901 | $8408 |
| Additional | Add $6900 | Add $575 |
If your income or your household income is below these numbers, then you may qualify for Chapter 7 bankruptcy and the new Means Test does not apply. However, if your income has increased since the last six (6) months, that will be a factor in determining eligibility as well.
Even if you or your household income is higher than the above income figures, you may still qualify for Chapter 7 bankruptcy if you pass the new Means Test.
Contact one of our Columbus area law offices for information on the means test and qualifying for Chapter 7 bankruptcy in Ohio. Our team of experienced attorneys will determine if you qualify for Chapter 7 bankruptcy, Chapter 13 bankruptcy, or even if debt settlement or a loan modification may be a better option. We are here to provide you with the legal guidance needed to help you resolve your debt problems.
Frequently Asked Question on Chapter 7 Bankruptcy
I have heard that Chapter 7 is “liquidation bankruptcy.” Does that mean that the Chapter 7 Trustee will liquidate my property?
Not necessarily. The reason for this answer is that you only lose the assets that are not encumbered by liens (for example, a mortgage on a home) and that are not protected by exemptions. The starting point is the fair market value of your asset, less the amount owed and your exemption.
This is easiest to understand through an example. Let’s assume a married couple jointly owns a home which is worth $200,000.00 . They owe $160,00.00 on their mortgage. Because each person has a homestead exemption of $21,625.00 ,even though there would be equity if the couple sold their home today, the homestead exemption makes it so there is no equity for purpose of a Chapter 7.
There are exemptions for all types of property. Note that even though bankruptcy is a part of the federal court system and is based largely on federal law, many states, including Ohio, are “opt out” states. This means Ohio uses its own exemptions. So, you may come across different exemptions under the bankruptcy code itself that would not apply to Ohio filers.
Clients who have assets in excess of the allowable exemptions for Ohio would typically choose to file Chapter 13, rather than a Chapter 7, in order to protect those assets. Watch our video on Chapter 7 Bankruptcy
Is Chapter 7 bankruptcy the type of bankruptcy that is called “fresh start” bankruptcy?
Yes. Many people refer to Chapter 7 bankruptcy as “fresh start bankruptcy” because, in a Chapter 7 bankruptcy, the filer is not required to repay their unsecured debts. A Chapter 7 bankruptcy discharge “wipes out” unsecured debt and gives the filer a fresh start. However, there are a few debts, such as child support, student loans, and certain taxes which are not dischargeable in bankruptcy. Contact our office for a complete list of debts that are not dischargeable in a Chapter 7 filing in Ohio.
Are your attorney fees comparable to other bankruptcy attorneys’ fees in the Columbus area?
Yes. We also offer payment plans. The fees for bankruptcy cases vary, depending on the complexity of the case. During your free initial consultation with one of our bankruptcy attorneys, we will evaluate your case and let you know the cost for representing you and filing your case. Remember, your first office meeting with an attorney is free.
How can I find out if filing Chapter 7 bankruptcy is the right choice for me?
Schedule a free consultation with one of our attorneys. We have Central Ohio offices in Columbus, Lancaster, Zanesville, and Delaware and our attorneys take appointments Monday through Saturday.
During your consultation, an experienced attorney will evaluate your entire financial situation. He/she will look at your income, your debts, and your goals. The attorney will then make recommendations on your best options for resolving your debt problems.
Each attorney in our law firm handles a full range of debt resolution options including, debt settlement, Chapter 7 bankruptcy, Chapter 13 bankruptcy, and mortgage loan modifications.
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The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 Requires the following notice:
We are a Debt Relief Agency. We help people file for bankruptcy relief under the Bankruptcy Code. This web site is not an offer to provide bankruptcy assistance services to any assisted person as defined under Section 527(a)(2) of the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.