To call the Means Test mechanism "diabolical" would simply be an accurate description.
The Credit Card and Banking Lobbies are good, and they write statues (like the 2005 Amendments to the Bankruptcy Code) that do what they are supposed to do, like making the bankruptcy process more dangerous, more expensive, more unpleasant and more onerous.
So a couple with two jobs, when reduced to one job, can't pay credit card debt, right?
Just makes sense.
So that couple should be able to file a Chapter 7 Bankruptcy right away, right?
Wrong, Insolvency Breath!
Instead, that couple is in the shooting gallery of every creditor known to mankind until that couple passes the Means Test, and can then file their Chapter 7 Bankruptcy.
Why don't they pass right away, when their income goes down?
Because that would make too darn much sense!
The Means Test is a six-month rolling LOOK-BACK, which means that the instant they lose a job, the Means Test STILL COUNTS the PRIOR six months of income in its evil calculator.
And one month after the firing, the couple will calculate, in their Means Test, one month reduced income and five months of the old income.
Get it?
If you don't, don't worry about it.
But that still leaves them bobbing on the water like a sitting duck, and potentially getting sued during the six months it may take them to pass the Means Test.
Now, we may be able to help you pass the Means Test a little faster, or not. Depends on you.
And I've written a little about what happens if you get sued prior to passing the Means Test, and what you might do if you are sued prior to passing the Means Test.
Don't panic, and don't ignore the Summons and Complaint.
The Credit Card and Banking Lobbies are good, and they write statues (like the 2005 Amendments to the Bankruptcy Code) that do what they are supposed to do, like making the bankruptcy process more dangerous, more expensive, more unpleasant and more onerous.
So a couple with two jobs, when reduced to one job, can't pay credit card debt, right?
Just makes sense.
So that couple should be able to file a Chapter 7 Bankruptcy right away, right?
Wrong, Insolvency Breath!
Instead, that couple is in the shooting gallery of every creditor known to mankind until that couple passes the Means Test, and can then file their Chapter 7 Bankruptcy.
Why don't they pass right away, when their income goes down?
Because that would make too darn much sense!
The Means Test is a six-month rolling LOOK-BACK, which means that the instant they lose a job, the Means Test STILL COUNTS the PRIOR six months of income in its evil calculator.
And one month after the firing, the couple will calculate, in their Means Test, one month reduced income and five months of the old income.
Get it?
If you don't, don't worry about it.
But that still leaves them bobbing on the water like a sitting duck, and potentially getting sued during the six months it may take them to pass the Means Test.
Now, we may be able to help you pass the Means Test a little faster, or not. Depends on you.
And I've written a little about what happens if you get sued prior to passing the Means Test, and what you might do if you are sued prior to passing the Means Test.
Don't panic, and don't ignore the Summons and Complaint.
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