You cannot file for personal bankruptcy under the following circumstances:
- You have previously filed for bankruptcy and haven’t been discharged
- You are not insolvent. You are “insolvent” if the total amount of debts you owe exceeds the fair market value of the assets that can be realized by a trustee in bankruptcy. For example, if you owe $25,000.00 in credit card debt but you have mutual funds with a current value of $50,000.00, you won’t be able to file for bankruptcy – you can simply liquidate your mutual funds and use the proceeds to pay off all your debt on your own
If none of these situations apply to you, you can file for personal bankruptcy if that is the solution that best suits you. However, there are some unique situations that may apply to you which you should consider before making a final decision, for example:
- If you are a lawyer, you will be unable to operate a trust account while you are an undischarged bankrupt
- You cannot act as a director of a corporation if you are an undischarged bankrupt
You should speak with your Licensed Insolvency Trustee in detail about your job or professional situation to determine how filing bankruptcy will affect your standing in your profession.