Looking to file for bankruptcy in Massachusetts? Here’s what you need to know. The Commonwealth recognizes two primary paths for individuals seeking debt relief: Chapter 7 and Chapter 13 filings. Let’s break down the specifics.
For those considering Chapter 7 (sometimes called “clean slate” bankruptcy), your household income typically needs to fall below the state median. Don’t worry if you’re slightly above this threshold – you might still qualify through what’s known as the means test. Consider it as a detailed look at your monthly budget after essential expenses.
Massachusetts law gets pretty specific about protecting your assets during Chapter 7. While you can keep certain possessions (the state has its list), anything not covered could be liquidated to pay what you owe. Pro tip: You might also want to look into federal exemptions – sometimes they work better for your situation.
Now, Chapter 13 works differently. You’ll need steady paychecks coming in to make this one work. It’s designed for folks who can pay something, just not everything right now. The courts recently updated the debt ceiling to $2.75 million (this applies to both secured and unsecured debts separately). Think of Chapter 13 as a fresh start with training wheels – you’ll be making payments for 3-5 years under court supervision.
Regardless of your chosen path, the Commonwealth mandates credit counseling from an approved provider. This must be completed no more than 180 days before filing your petition.
Please be advised: Previous bankruptcy filings may affect your eligibility. The court imposes mandatory waiting periods between filings (8 years post-Chapter 7 discharge; 4 years post-Chapter 13).
Given the complexity of bankruptcy proceedings, consultation with a qualified Massachusetts bankruptcy attorney is strongly recommended before initiating any filing. They can evaluate your specific circumstances and provide guidance tailored to your financial situation.
