Chapter 7 bankruptcy filing offers you fresh financial start and a chance to escape your debts, but is also notorious for involving a complicated and drawn-out process. These complexities can make for potential pitfalls that could lead to involuntary dismissal of your bankruptcy case.
A mistake in the filing or trial process on the part of a debtor could lead to their case being dismissed, which would mean that they are still responsible for their debts and in danger of repossession. This is why it is advisable to hire a bankruptcy lawyer to guide you through the filing process, so as to escape possible problems that could lead to dismissal. Here are some common reasons that could lead to your bankruptcy case being dismissed.
Anyone filing for bankruptcy is required to fill certain forms that report various aspects of their finances. Failing to accurately provide information on your incomes, liabilities and creditors, or conveniently leaving out a debt or certain asset so as to spare it from liquidation, could lead to dismissal of your case on grounds of fraud. Trying to fudge the numbers or mislead a bankruptcy court could also lead to criminal charges and even incarceration.
Even the most well-intentioned debtor with no intention of committing fraud could find themselves in trouble with the law due to the complexities of the filing process. This is why it helps to have an attorney by your side while preparing to file, so that they can carefully look at your finances and help you fill all the required forms accurately.
Credit counseling and court fees
There is usually a requirement that all debtors intending to file for bankruptcy complete a mandatory credit counseling course before presenting their petition in court. Failure to complete this course in time could lead to dismissal of the case and denial of discharge from your debts.
Another possible pitfall that could lead to dismissal is failure to pay the required filing fees. With the help of your bankruptcy lawyer, you could seek a waiver for some of your court fees, especially if you have little or no income.
Failing the means test
Bankruptcy law usually requires that you pass a means test, which typically checks whether your income is low enough to qualify you for a debt discharge. By examining your recent earnings and comparing them to the average state earnings for a household similar to yours, the courts are able to determine whether you qualify for chapter 7 bankruptcy or not. Should you fail this test, your case will often be dismissed.
To learn more, contact a trial attorney like Irene M Rodriguez PA.