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Bankruptcy during Unemployment

Many debtors are concerned that their employment status may affect their right or ability to file for bankruptcy, but these suspicions are largely unfounded. There are no specific requirements in Texas or any other state that an individual must hold employment in order to file for bankruptcy, although there are a number of factors that are relevant to your eligibility for Chapter 7 and Chapter 13 that will be directly affected by your employment status.

If you are facing excessive debt that you are unable to repay under your current fiscal situation, bankruptcy may be the right choice to help you achieve a measure of debt relief. The Houston bankruptcy attorneys at the Russell Van Beustring P.C., are committed to providing clear and effective guidance to our clients in order to help them move through the bankruptcy process as efficiently and effectively as possible. To learn more about your rights and options for recovery, call us today at 713-973-6650.

Unemployment in Chapter 7

Eligibility for Chapter 7 bankruptcy is determined by a process known as the means test, in which the applicant’s monthly income is compared against the median income of a household of equal size. If your income is below the median, you will automatically qualify for Chapter 7. As such, a majority of debtors who lack employment are able to file for bankruptcy.

Unemployment in Chapter 13

Chapter 13 bankruptcy requires that you have enough monthly income to pay off your secured debts over a period of 3 or 5 years through regular monthly payments made to the bankruptcy trustee appointed by the court. Unemployment may have a significant negative impact on your monthly income and make Chapter 13 impossible, but it is entirely feasible to have income outside of employment which is sufficient to fund your repayment plan.

Contact Us

At the Russell Van Beustring P.C., our legal team is dedicated to the clear and effective guidance of debtors seeking relief, and will work diligently to help you find resolution to your financial troubles. For a free consultation to discuss the details of your case with an experienced Houston bankruptcy lawyer, call us today at 713-973-6650.


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