How to Qualify for Chapter 7 Bankruptcy in Louisiana

If you’re facing overwhelming debt in Baton Rouge, Chapter 7 bankruptcy may offer the relief you need. At Hester Law Firm, we help individuals understand their options and take the steps necessary to regain financial control. Here's what you need to know about qualifying for Chapter 7 bankruptcy in Louisiana.

Understanding Chapter 7 Bankruptcy

Chapter 7 bankruptcy is often called “liquidation” bankruptcy. It allows eligible individuals to eliminate most unsecured debts, such as credit card balances, medical bills, and personal loans. In exchange, non-exempt assets may be sold by a court-appointed trustee to repay creditors.

Not everyone qualifies. Chapter 7 has specific requirements designed to ensure that only those truly unable to repay their debts benefit from this form of relief.

The Means Test: Key to Eligibility

The most important factor in qualifying for Chapter 7 is passing the Means Test. This test compares your household income to the median income for a household of your size in Louisiana.

• Below Median Income: If your income is below the median, you typically qualify without further analysis.
• Above Median Income: If your income is above the median, the Means Test will examine your expenses and disposable income to determine if you can repay part of your debts through a Chapter 13 plan instead.

As of 2025, the median income figures are updated periodically and depend on household size. It’s important to consult with a bankruptcy attorney to get current data and apply it to your unique situation.

Other Chapter 7 Requirements in Louisiana

In addition to passing the Means Test, you must also meet these qualifications:

• Credit Counseling: You must complete a credit counseling course from an approved agency within 180 days before filing.
• Previous Bankruptcies: You cannot have filed a Chapter 7 bankruptcy within the last 8 years (or Chapter 13 within 6 years) if you received a discharge.
• No Fraudulent Behavior: If you’re found to have committed bankruptcy fraud or attempted to hide assets, your case may be dismissed.

Exemptions in Louisiana

Louisiana has its own set of bankruptcy exemptions that protect certain types of property from liquidation. Common examples include:

• Homestead exemption (up to a certain value of equity in your home)
• Vehicle exemption
• Tools of the trade
• Wages and retirement accounts

Knowing what you can keep is essential, and a bankruptcy attorney can help apply the right exemptions to protect your assets.

Get Help From a Baton Rouge Bankruptcy Attorney

Bankruptcy is a powerful legal tool—but only if used correctly. At Hester Law Firm, we work closely with Baton Rouge residents to evaluate their financial situations and determine if Chapter 7 is the right path. We’ll guide you through every step, from the Means Test to final discharge, ensuring your paperwork is accurate and your rights are protected.