• Filing for bankruptcy may be an option if you can't budget yourself out of debt within 5 years.Bankrupt. Businessman with empty pockets (with clipping paths) . image by Vitaliy Pakhnyushchyy from Fotolia.com
  
  Filing for bankruptcy is sometimes the only viable way of ending financial trouble. However, before thinking of filing for bankruptcy in Texas it is important to be familiar with the qualifications that must be met. While bankruptcy will remove some of your debts, there are certain financial obligations for which you will still be held accountable.
  
  

Qualifications

• According to Lawyers.com, you may be eligible for bankruptcy in Texas if you are only able to pay a minimum amount on bills; are receiving foreclosure notices on loans or mortgages; have suffered a major financial setback such as divorce, illness, or job loss; or you are unable to reasonably budget your way out of debt within five years.
  
  

Exceptions

• Lawyers.com reports that some debts cannot be removed by bankruptcy, such as the majority of student loans, child support, alimony, back taxes or fraudulent debt, Government fines and/or penalties, as well as "Recent large purchases of more than $550 for luxury goods bought within 90 days of filing " and "Cash advances of $825 within 70 days of filing."
  
  

Types

• There are two types of bankruptcy that can be filed in Texas. Chapter 7, which is known as straight bankruptcy or liquidation, eliminates all debts except those listed above and provide, as Lawyers.com suggests, an "immediate fresh start." To qualify for Chapter 7, you must undergo a means test "to determine whether a debtor has enough income, in addition to the income he needs to survive, to pay off a portion of his debt." If you do not qualify for Chapter 7 bankruptcy, Chapter 13, or wage-earner bankruptcy, may be a possibility. Under Chapter 13, a payment plan is arranged for the debtor to pay back debt over an agreed upon number of years.
  
  

Specifications

• When filing for bankruptcy under Texas law, you have the option of deciding between the federal exemption statutes on what you may keep and the Texas exemption statutes. The items listed in the exemption statutes are subject to change over time, so it is important to check the state code when filing. More importantly, it is essential that you retain a lawyer to be advised and represented in all bankruptcy dealings.