How Unemployment Affects Bankruptcy

Statistics compiled by the Bureau of Labor Statistics reveal that 4.1% of Americans are currently unemployed. Without a regular income, many people face difficulties in keeping up with their bill payments. Many people in this situation discover that bankruptcy offers the opportunity to reduce financial hardships. If you are currently navigating financial complications after unemployment, filing for bankruptcy can help to reduce and sometimes even eliminate many debts. While being unemployed might increase your chances of obtaining certain types of bankruptcy, not having a job can prevent you from qualifying for other types of bankruptcy. It is important for unemployed individuals to understand how their employment status can affect filing for bankruptcy. In most situations, it is also important to contact an experienced bankruptcy lawyer. How Unemployment Affects Chapter 7 Bankruptcy A person is not required to be employed to file for Chapter 7 bankruptcy. Instead, unemployment can often help a person qualify for Chapter 7 bankruptcy. The means test to qualify for Chapter 7 bankruptcy measures a person’s financial ability to repay creditors. If your income falls below the median income for a household of equivalent size, you will be considered to have passed the means test and be [...]