Struggling with overwhelming debt can be stressful, and many wonder whether they qualify for Chapter 7 bankruptcy. What is the bankruptcy means test in Michigan?
The bankruptcy means test in Michigan determines whether an individual’s income and expenses qualify them for Chapter 7 bankruptcy. If your income is below the state median, you automatically qualify; if it exceeds the threshold, additional calculations determine eligibility.
Continue reading “What is the Bankruptcy Means Test in Michigan?”
Start Your Financial Reset
Embrace A Debt-free Future
Frequently Asked Questions
How do I know if I qualify for Chapter 7 in Michigan?
If your household income is below Michigan’s median income level, you qualify automatically. If your income is higher, the means test will calculate your allowable expenses and disposable income.
Can I pass the means test with a high income?
Yes, if you have high necessary expenses—such as mortgage payments, medical bills, or childcare costs—you may still qualify after deductions.
What happens if I fail the means test?
Failing the means test means you may need to file for Chapter 13 bankruptcy, which involves repaying a portion of your debts over 3–5 years.
Does every bankruptcy filer have to take the means test?
No, if your debts are primarily business-related, you may be exempt from the means test.
Should I retake the means test if my income changes?
Yes, if your income decreases due to job loss, medical expenses, or other financial hardship, you may requalify for Chapter 7 bankruptcy.