I own a small business(motel). It's a non performing loan. Bank has sold the note to a private investor at a deep discount. The note holder is harassing me with the threat to garnish my paycheck after seeking a judgment for the deficiency.
I make six figure salary, so I wonder if I am allowed to bypass the means test due to the fact that all of my debt is business related(All non-consumer).
If so, can the creditor still try to stop chapter 7 filing?
Divorce / Separation Lawyer
The means test does not apply if the majority of your debt (50% plus $1) is business debt.
The six figure salary may present (depending on your expenses and other debt) a possible good faith issue, but your attorney can assess that.
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As stated, the means test does not apply if most of your debt is business debt (that includes your house, cars, etc, as personal debt), but creditors and the US Trustee do have the ability to contest a Ch. 7 discharge if someone has significant income. It is not used much, but it can happen. See a lawyer - it might be a case in which the worst thing that can happen is a dismissal.
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When congress passed BAPCPA, they installed the means test as a threshold factor in determining eligibility for chapter 7. However, they did not get rid of the old "good faith" test. Although the means test will not be required in your case, the good faith will be based on your income and actual expenses. Basically, if you have money left over after your living expenses, business expenses, and payments on debts related to property you want to keep, you might have an issue with chapter 7. However, if the budget shows money left over each month, you could file a chapter 13 and pay that amount over 5 years to unsecured creditors. At the end of that time period, any unpaid, non-dischargeable debt would be discharged. This usually ends up a better deal than a garnishment. I recommend calling a bankruptcy attorney on this site and setting a time to come in and go over all of the facts and figures to find out for sure what you can and can't do.
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