What are the debt limits for bankruptcy?

There are none in a chapter 7.  My biggest chapter 7 I ever filed had a debtor with a little over $12,000,000 in debt from a number of bad real estate transactions.  Very bad real estate transactions.

There are debt limits in a chapter 13.  If you go over these limits, the Chapter 13 Trustee will move to dismiss your case, and he will win.  Under 11 U.S. Code § 109 – Who may be a debtor:

(e) Only an individual with regular income that owes, on the date of the filing of the petition, noncontingent, liquidated, unsecured debts of less than $250,000 and noncontingent, liquidated, secured debts of less than $750,000, or an individual with regular income and such individual’s spouse, except a stockbroker or a commodity broker, that owe, on the date of the filing of the petition, noncontingent, liquidated, unsecured debts that aggregate less than $250,000 and noncontingent, liquidated, secured debts of less than $750,000 may be a debtor under chapter 13 of this title.

In other words, if you owe more than $250,000 of unsecured debt (things like credit cards and medical bills) and/or if you owe more than $750,000 of secured debts (like car loans or mortgages), you cannot file a chapter 13.  You have too much debt.

In this kind of situation, you’re either looking at a chapter 7 or a complicated and very expensive chapter 11.

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