Do You Have to Be Behind on Payments to File Bankruptcy?

Many people have filed for bankruptcy, but not all have been delinquent. You may be confused by this. Don’t you have to miss payments in order to be eligible for bankruptcy?

It might be time to declare bankruptcy if you have exhausted all your other options. Bankruptcy may be a good idea if you have large debts that you can’t repay.

However, you do not have to have a minimum amount of debt in order to file. Neither Chapter 7 nor Chapter 13 bankruptcy requires that you be behind on your bills before filing. Chapter 7 does require passing a means test. If your income is below the median income where you live, you automatically qualify for Chapter 7. To qualify for Chapter 13, you must have a regular source of income as well as enough disposable income to pay some amount to creditors.

Those are the only requirements. Neither type of bankruptcy requires that your credit score be too low or that you be behind on bills. You are able to file bankruptcy even if you are up-to-date on all of your payments and you have a perfect credit record.

However, you want to thoroughly assess your financial options. Bankruptcy is not something to be taken lightly.

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No delinquency is necessary to file for bankruptcy, but if you are making the minimum payments on your debts and barely squeaking by to pay for essentials, bankruptcy may be a good option. However, it is a major event that needs to be thought out thoroughly.

Florida bankruptcy attorney Brian K. McMahon, P.A. can help you explore your options. Bankruptcy is not the only option to address your debt, but it is very powerful and often the best choice. Call (561) 658-1789 or fill out the online form to schedule a consultation. We serve the West Palm Beach, Boca Raton, Port St. Lucie, and South Florida areas.