Chapter 7 bankruptcy allows people to get out from under massive personal debts by eliminating all of the debt. In exchange for this debt elimination personal property is often sold off, or liquidated to pay back some of the companies that the person filing owes money to. Not every person is eligible for, or should file for Chapter 7 bankruptcy. There have been many cases over the years where people with very high incomes have attempted to use Chapter 7 bankruptcy to get out of their responsibilities for repaying debts that they are perfectly capable of paying. As a result of some of the fast and loose filing that has taken place, new restrictions are in place that make it harder for these kinds of bankruptcy filings to take place.

Legitimate Chapter 7 Bankruptcy

It is unfortunate that some of the new restrictions have made it a little more cumbersome for people that legitimately need and qualify for Chapter 7 to file for it. In Chandler, AZ, like the rest of the country there are new laws in place that enforce what is called a “means test” for people that are thinking about filing for Chapter 8 bankruptcies. The means test is a series of steps and requirements that people need to adhere to in order to file for Chapter 7 bankruptcy. Not meeting the standards set by the means test will result in some people having to opt for a Chapter 13 bankruptcy instead of a Chapter 7 bankruptcy.

Arizona Means Laws

If you live in Arizona and think that you need to file for Chapter 7 bankruptcy, don’t let the existence of the means laws be a reason to be intimidated. A lot of people in the media have made it seem like no one will ever be able to qualify for a Chapter 7 bankruptcy thanks to the new means laws. If you meet the criteria for the means test, you can still qualify for a Chapter 7 bankruptcy. It may require a few additional steps and a little extra work to make sure that you qualify, but the means test is not in place to penalize the average person that needs and qualifies for Chapter 7 bankruptcy.

Arizona personal bankruptcy means test requires people to be within a certain income bracket to qualify for a Chapter 7 bankruptcy. Here are some of the income levels that you should be aware of:

• 1 Earner Limitation is $42,628
• The 2 Person Limitation is $56,984
• The 3 Person Family Limitation is $62,066
• The 4 Person Family Limitation is $69,452

There are other requirements that are part of the means test, like debt to income ratio. As you go through the process of filing for bankruptcy, be sure that you understand the details and requirements that you must adhere to. Bankruptcy laws are there to protect you when you need protection from creditors.