Chapter 7 Bankruptcy Information

This very rarely happens. When you file a chapter 7 bankruptcy you are allowed certain exemptions under the law. While these exemptions are too lengthy to list here, most people are concerned with the car and homestead exemptions.

The Texas motor vehicle exemption is a very generous exemption. It allows for the full value of one car for each licensed driver in your household. And, if a member of your household is not licensed but depends on the vehicle for transportation, that vehicle can be exempted.

The Texas Homestead exemption allows for an unlimited exemption for a home on 10 acres or less in a city, town or village, or 100 acres or less in the country (this is increased to 200 acres for families).

There are numerous other exemptions allowed in a chapter 7 in Texas including (but certainly not limited to) exemptions concerning livestock, jewelry, home furnishings, and fire arms, just to name a few. As you can see, Texas exemptions are quite generous and if you have personal property that exceed these exemptions, you would likely choose to file a Chapter 13 in order to protect these assets. However, it is unusual for an individual / married couple to have assets exceeding Texas exemptions.

In order to qualify to file a chapter 7 you must meet certain income requirements. The first step in figuring out if you qualify for Chapter 7 bankruptcy is to take a look at your income for the past 6 months. We will need to determine if you and your family are above or below the median income based on the last six (6) months of gross income.

Locate your family size on the chart below. The median income for Texas residents is as follows:

Household Size Annual Income:
1 $38,801
2 $55,650
3 $59,011
4 $66,145
5 $73,645
6 $81,145

If you live in Texas and your income or your household income is below these numbers, then you may qualify for Chapter 7 bankruptcy and the new Means Test does not apply. However, if your income has increased since the last six (6) months, that will be a factor in determining eligibility as well.

Even if you or your household income is higher than the above income figures, you may still qualify for Chapter 7 bankruptcy if you pass the new Means Test.

Contact our San Antonio law office for information on the means test and qualifying for Chapter 7 bankruptcy in Texas. Our experienced attorneys will determine if you qualify for Chapter 7 and from there we can help you determine if it is in your best interest to file Chapter 7. We are here to provide you with the legal guidance needed to help you resolve your debt problems.

While bankruptcy filings are a matter of public record, there is no reason your employer should find out if you file chapter 7.

While a bankruptcy stays on your credit report for 7-10 years, this does not mean that you will not be able to get credit for 7 to 10 years. In most cases, a person who is considering bankruptcy has already done some damage to their credit score by making late payments, etc. A chapter 7 allows you to get rid of that debt and start fresh. After filing a chapter 7 your debt to income ratio will actually look more favorable to some creditors. Most importantly, your ability to obtain credit after filing bankruptcy really depends on how you handle your finances after you file. If you have reasonable amounts of debt and you pay your payments on time, you will be able to rebuild your credit.