Consumer debt bankruptcy cases require the Debtor to enter information and make computations with income, expenses, and deductions, which ultimately result in the Debtor being eligible for Chapter 7, eligible for a 3-year Chapter 13 plan, or being required to have a 5-year Chapter 13 Plan.
Our office typically bills clients a flat or hourly rate to perform a means test which can be applied toward the regular fee in the Chapter 7 or Chapter 13 if we are fully retained to file on your behalf.
The most common reason that we do a means test for clients before filing the case is that the client wants to know: (1) am I eligible for Chapter 7?; or (2) if I am in a Chapter 13, what might my approximate plan payment be?
Although the initial means test may be adjusted later on in the case, it can be used as a barometer for the appropriate Chapter that you should file, based on your income, assets, expenses, and goals. It can also provide you with a realistic expectation of what is required to make a Chapter 13 work.