Phoenix Bankruptcy Lawyer Help: Do I have to have a job to file for bankruptcy?

As a phoenix bankruptcy lawyer we see all situations, especially in today's economy and bankruptcy is about seeking help during your lowest financial point. So for a lot of people, losing a job is really going to be their lowest financial point. A lot of people get caught up with the idea of, "How do I pull myself out of this? Where do I end this tailspin with all this debt?"

A great way to do it, if you've lost your job, is to file bankruptcy. It's going to be your lowest financial point.

The other thing about this is, if you don't have a job, you're practically insured that you're going to qualify for Chapter 7. Many people don't qualify for Chapter 7 because of the income requirements.

They simply make too much money, But without employment, there's a pretty good chance that you will certainly quality.

When a debtor is filing a Chapter 7, they have to show they do not have enough income available to pay their creditors. Now in a Chapter 13, which is where you have income and you have continual income, you're going to reorganize your debt.

Depending on what type of debt that you have, you're going to be filing a Chapter 7 or Chapter 13. The fact that you have income qualifies you for the Chapter 13 because then you have the ability to repay some of that debt. Not all of it, but you are going to catch up on maybe your house payment. Or you're going to catch up on your car payment. Or you need to catch up on your student loans. You're going to need income to do that.

Without employment, then you're looking at a Chapter 7. The upside is that your debt goes away. But also without employment, you're going to have to give up the house and give up the car. For so many people, especially in Arizona, there are so many homes that are upside down right now that, maybe giving up that overpriced home or the mortgage that is far more than the actual value of the home, might be in their best interest.

When we talk about what you can do after bankruptcy, we can talk about where you're at with homes and cars here in Arizona.

So it depends really on what type of Chapter you're filing. With a Chapter 7, if it's your lowest financial point without income, that's a great alternative to you. But with income, consider a Chapter 13.

Don't think that because of your job loss you will not get to move forward with everything in your life. If you're looking at a lost job and you're not certain what your financial future is going to be or how you're going to juggle the debt that you have, and then consider speaking with an attorney.

That attorney is going take you through a means test and the means test is something that the bankruptcy code has set up. It will look at your income over the last six months.

So once an attorney has done that analysis, you can determine if you're above the means test, which means you're a good candidate for a Chapter 13, or if you're below the means test, which means you're a good candidate for a Chapter 7.

It's about income. It's about IRS allowances and the last two years of tax returns. There's a lot that goes into a bankruptcy.

A job is part of it, but not 100% of it.