Filing for bankruptcy certainly does not mean that the bankruptcy will be granted. People sometimes act as if individuals or business owners are just allowed to file for bankruptcy whenever they want to get rid of their debt. But that’s not the way that it works. Only some bankruptcy filings are approved.
As a result, it’s important to know why you could be denied. There are a multitude of reasons, but we will look at some of the most common ones below.
You don’t qualify
First and foremost, you may simply not qualify for the type of bankruptcy you’re trying to use. For instance, you can make too much money to use Chapter 7, which may mean that you have to use Chapter 13 instead.
You were accused fraud
In some cases, people are accused of committing fraud by intentionally hiding property that they own. You could also be accused of making false statements about the assets and debts that you have, or even destroying financial records.
It hasn’t been long enough
Another thing to keep in mind is that you can only file for Chapter 7 bankruptcy every eight years. You can only file for Chapter 13 bankruptcy every six years. If this is not your first time using the process, you may simply be denied because it hasn’t been long enough, even if your case checks all the other boxes.
Working through the process
Because bankruptcy can be denied, it’s important to know exactly what steps to take. You need to know what legal options you have and what is required to give your case the best possible chance at success.