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Which Tennessee residents are eligible for Chapter 13 bankruptcy?

Bankruptcy law offers Tennessee residents the opportunity to reset their finances and start again, hopefully smarter and wiser from the experience. And, indeed, many success stories have grown from the seeds of bankruptcy. But, not everyone can qualify for the benefits that bankruptcy provides. There are certain qualifications that need to be met in order for a Tennessee resident to be eligible for Chapter 13 bankruptcy.

Businesses, such as corporations and limited liability companies, do not qualify for Chapter 13. Only individuals and couples filing jointly have Chapter 13 as an option. Likewise, people who have filed a previous bankruptcy may not be eligible. People who have filed for a Chapter 13 bankruptcy must wait more than two years before they can file again. People who have filed for a Chapter 7 bankruptcy must wait more than four years before they can file again.

Similarly, people who have had a bankruptcy filing dismissed in the last 180 days may not be able to file again under certain circumstances. Specifically, if the person willfully failed to appear in court or violated a court order, or if the person requested that the case be dismissed after a creditor requested that the court life the stay that automatically accompanies a divorce filing.

A fourth group that is not eligible for Chapter 13 are those people who have too much debt. Chapter 13 caps eligibility to people with less than $336,900 in unsecured debt and $1,010,650 in secured debt. These numbers change often depending on inflation.

Tennessee residents considering bankruptcy may benefit from getting more information about their own unique financial circumstances.

Source: FindLaw, "Who Can File for Chapter 13 Bankruptcy?" Accessed June 27, 2016

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Mark T. Young & Associates
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Hixson, TN 37343

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