How to Qualify for Bankruptcy Protection in Wisconsin

Filing for bankruptcy can be a challenging decision, but it may provide the relief needed to regain financial stability. In Wisconsin, understanding how to qualify for bankruptcy protection is vital for anyone considering this option. There are several steps and criteria involved in the process.

First, it is essential to determine which type of bankruptcy you need to file. The most common options for individuals are Chapter 7 and Chapter 13 bankruptcy. Chapter 7 eliminates unsecured debts, while Chapter 13 allows for repayment over time.

To qualify for Chapter 7 bankruptcy in Wisconsin, you must pass the means test. The means test compares your income to the median income for families of your size in Wisconsin. If your income is below the median, you can file for Chapter 7. If it's above, you will need to calculate your disposable income by deducting certain permitted expenses from your current monthly income.

For Chapter 13 bankruptcy, the qualifications are different but still straightforward. You need to have a regular income and your total unsecured debts must be less than $465,275, while secured debts cannot exceed $1,395,875. This option is suitable for those who wish to keep their assets and repay debts over a three- to five-year plan.

Another requirement for both types of bankruptcy is that you must have completed a credit counseling course from an approved provider within 180 days before filing. This step is crucial and is designed to ensure that you understand the consequences of filing for bankruptcy and consider alternatives.

In Wisconsin, you must also provide a variety of documentation when filing for bankruptcy. This includes details about your income, expenses, debts, and assets. Accurate and comprehensive documentation is essential for a smooth process.

If you have already filed for bankruptcy in the past, timing matters. If you previously filed for Chapter 7, you must wait eight years from the date of that filing to qualify for another Chapter 7. However, you can file for Chapter 13 sooner, typically after four years.

Consulting with a qualified bankruptcy attorney can greatly simplify the process. They can help you navigate the complexities of bankruptcy laws and ensure that you meet all the necessary requirements. Additionally, an attorney can assist with preparing the required paperwork and representing you during hearings.

In summary, qualifying for bankruptcy protection in Wisconsin involves understanding the different types of bankruptcy, passing the means test for Chapter 7, having a steady income for Chapter 13, completing a credit counseling course, and gathering the necessary documentation. With the right guidance, you can take the steps needed to regain control over your financial future.