The answer is no. Congress revised the bankruptcy code in 2005, and under the 2005 amendments to the bankruptcy code, there’s something that was put in place called the Means Test. Don’t do it at home. That’s why you’ll notice on my website, I don’t have a tool that says, “Try this yourself and see what chapter you qualify for.” On paper, if you earn over a certain amount for a certain number of people in your household, it would look like you were automatically pushed out of the Chapter 7 into a Chapter 13 or Chapter 11 where you could instead have a clean slate on your debts in a Chapter 7.
With Chapter 7, you’re in and out of bankruptcy in a matter of months, life is good, you’re moving forward. You’d be forced into, if you didn’t qualify for Chapter 7 based on income, and it was a 13, that in that 13 you would be in it for a period of three to five years repaying a portion or all of your debt.
Don’t let the fear of having to pay back some of your debt stop you from coming in for a consultation. I work with that Means Test. There is jurisdictional law, federal law, local case law that can help bring you back from where you think, “Oh my God, I’m a Chapter 13 and I have to pay back money,” into, “Okay, now we’re at a Chapter 7, you’re getting a discharge of your debt.”
Certainly, there are times when someone is going to actually have to be a Chapter 13 bankruptcy, and that’s okay too because in a Chapter 13, even if you’re paying back a portion of your debt, all the collection efforts are stopped, lawsuits are stopped, interest and fees are stopped on all the debts, and it’s pretty much an interest free loan from the government to help rebuild, restructure, and get out from under your debt.