What Are the Requirements to File Bankruptcy In Georgia?

If you are suffering under crippling debt, bankruptcy can offer relief.Victim suffering image by Gleb Semenjuk from Fotolia.com

It is not all that unusual for individuals to find themselves trapped under crippling debt. Whether you are trying to keep your home out of foreclosure, have been laid off from your job, or are trying to cope with unexpected medical expenses, debt can be a burden. But there is relief available. Although bankruptcy is not to be taken lightly, it is a viable solution. If you live in Georgia and find yourself in a financial crunch, then bankruptcy may be the choice for you.

Credit Counseling

At least 180 days before a debtor can file bankruptcy, the individual must go through credit counseling from a government-approved organization. The arm of government that approves the organization is the Department of Justice's U.S. Trustee Program. Debtor pre-bankruptcy credit counseling ensures the bankruptcy court that the debtor knows his options and is making an informed decision when filing for bankruptcy. During your pre-bankruptcy counseling session, your personal financial situation will be evaluated, alternatives to bankruptcy will be discussed, and a personal budget plan will be created. The fee for credit counseling should be about $50, but as can be expected, some people may have a hard time paying the fee. In that case, you should request a fee waiver from the credit counseling organization before your session begins.

Individuals, married couples, corporations, and partnerships can file for Chapter 7 bankruptcy if they have not had a Chapter 7 bankruptcy discharge within the last eight years. When filing for bankruptcy in the state of Georgia, you must have been a resident of the state for 90 days prior to filing. A debtor also needs a bankruptcy attorney, because the bankruptcy process is so complex. Mistakes can lead to dismissal of your case. After your lawyer files your bankruptcy petition, the bankruptcy court appoints a trustee to your case. The trustee's role is to gather as many of your assets as possible, sell them, and use the proceeds to pay your creditors. The trustee reviews the debtor's court filings and meets with the debtors at the first meeting of creditors to discuss the debtor's assets and financial obligations. The trustee then determines which of the debtor's assets are exempt and non-exempt.

Before the trustee assesses your debt, however, it must be determined that you are not trying to abuse the bankruptcy process. The bankruptcy court employs a formula called the "means test" to determine whether or not you have the means to pay your debt. They compare your income to the state's median income, and if your income is below the median with less than $100 disposable income left over each month, you qualify to file for Chapter 7 bankruptcy. You will be able to find the Georgia state median income by family size and by number of earners in the family on the Census website (see Resources).