Qualifications for Bankruptcy in Pennsylvania
Whichever types of bankruptcy there may be, there are qualifications for filing. This varies from state to state. In Pennsylvania, there are four guidelines an individual must meet in order to file.
Types of Bankruptcy Guidelines
- Residency. The individual filing must have been a Pennsylvania resident 91 out of 180 days. If an individual has not been a resident for the required amount of days? They must wait to file any form of bankruptcy.
- Waiting Period. There is no initial waiting period to file for bankruptcy but an individual can not file more than once in a two-year span.
- Credit Counseling. They require an approved credit counseling session (completed) before filing for bankruptcy. An individual can find an approved credit counselor on the U.S. Department of Justice website. There also may be a small fee for this session.
- Debt Amount. To qualify for chapter 13 bankruptcy an individual’s secured debt (loan with collateral) must be under $1,184,200 and unsecured debt (loan without cosigner or collateral) must be under $394,725. To qualify for chapter 7 bankruptcy an individual’s monthly income cannot be more than the median income of their family size in the state. If they find an individual has too much income, they may not be able to file for chapter 7 bankruptcy.
Before filing for bankruptcy an individual should first explore all types of bankruptcy and other options. If a mortgage is an issue, an individual may want to ask the debtor about mortgage modification. Banks are able to adjust the original terms of a mortgage to help lower monthly payments. If the issue is too many payments going out in any given month, an individual should inquire about debt consolidation. A financial establishment may be willing to loan an individual a lump sum of money to pay off all or most of their debt. Then, the individual will then in return, only have one monthly payment to make to the said financial establishment.
Steps to Bankruptcy
When an individual has met all the bankruptcy qualifications and has exhausted all other options, they may have no other choice than to file for bankruptcy. To help prepare to meet with a lawyer an individual will want to take these steps:
- Check credit report for any suspicious activity and simply know how much debt they have
- Make sure their debt is dischargeable (Medical bills, credit card debt, personal or business loans)
- Have any financial paperwork readily available (bank statements/pay stubs/tax returns/utility bills/credit report)
- Determine how they are filing. If an individual is in a marraige they can file one of three ways (similar to taxes) alone, married but separately, or jointly. Being able to determine the best option for them will save an individual not only time but money. If a couple wishes for discharge of both of their debts, they will want to file jointly to avoid double filing fees.
- Have a complete list of assets. Attempting to hide any form of asset is bankruptcy fraud. It could result in a case dismissal or even criminal charges.
Filing for bankruptcy can be done without a lawyer but is not suggested. Filing and lawyer fees are not determined by filing status. In Pennsylvania to file for chapter 7, an individual will pay $306 and $281 to file chapter 13. If the full amount can not be paid up front the court may allow an individual to make payments.
Barifay Law Offices
Barifay Law Offices can help with navigating any and all questions or concerns an individual might have about filing for bankruptcy. They offer counseling and representation for individuals looking to file chapter 7 or 13 bankruptcy.