Can Anyone File Bankruptcy ?

June 2, 2010 - PRLog -- Eligibility seems straightforward. Unsecured claims cannot exceed $307,525.00 and secured debts cannot exceed $922,975.00 (as of April 1, 2004). These amounts are adjusted periodically. The debtor must be an individual. Debts which count toward either debt ceiling must be non-contingent, liquidated, unsecured debts Sounds simple but, frequently, it is not simple.
Chapter 13 eligibility should normally be determined by a debtor’s originally filed schedules, checking only to see if the schedules were made in good faith. 109(e).
What is secured? What is unsecured? At what point in time? When is a debt non-contingent and/or liquidated? To answer these questions, does the court rely on the Debtor’s schedules? What if the Debtor’s schedules are not accurate? This does happen on occasion.
The debtor has the burden to demonstrate this good faith. In re Huerta, 137 B.R. 356 (CD. Cal. 1992). This burden is different than a debtor’s other burden to demonstrate the debtor proposed the plan in good faith. What constitutes bad faith depends in each case on the facts presented. Within the Central District, the judges vary in what they conclude constitutes bad faith in filing a chapter 13 petition. As a practical matter, so long as the debtor files a single chapter 13 case, is honest in connection with the case, e.g., does not hide assets or misstate facts, good faith will generally not be a determining issue. The cases discussed below look at more egregious behavior and the outer limits of what debtors can do (or cannot do) and still have the requisite good faith when filing their chapter 13 petitions.

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I have been a licensed attorney since 1992. I have passed a rigorous examination and extensive experience requirements by the State Bar of California, Board of Legal Specialization. My firm helps prepares many different types of bankruptcy petitions. They will be prepared and filed in the Bankruptcy Court where the bankruptcy records will be stored for many years.