Bankruptcy and Pay Stubs - What You Don't Know Can Hurt You


The bankruptcy law has changed in order to put more requirements on those filing for Chapter 7. Before getting your debts wiped out, you have to go through some extra steps in order to prove that you need bankruptcy and cannot pay off all of your bills. What does this have to do with your pay stubs?

One of the new requirements is that you have to file some sort of evidence of your income (usually your pay stubs) for the money you have received during the last 60 days before bankruptcy. This is an extremely important part of the paperwork, and you should not ignore this even if it seems trivial.

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The thing is that the recent changes in the statutes were passed because many people were supposedly abusing the system and getting out of paying their financial obligations. These changes are supposed to help prevent people from abusing the system by making sure that a discharge is justified based on your income and expenses.

Whether or not this new bankruptcy statute was a good thing is beside the point. Your lawyer may think that it was bad for consumers, but you'll have to learn to live with that unless and until you convince your representatives to change the law.

For now, you'll have to comply with some of these changes. In the end, most people who would've qualified previously will still be able to successfully discharge of their debt through chapter 7. However, you have to be very careful with your paperwork and make sure that everything is in order based on your attorney's recommendations.

If you do not carefully file your pay stubs, your creditors can accuse you of misrepresenting your income in order to make it seem like you need a bankruptcy. Believe it or not, this kind of error can result in a dismissal of your case. Even if the judge feels sorry for you, he may feel that he has to dismiss your case depending on his interpretation of the law.


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