Chapter 7 Petition Analysis & Discharge Risk Assessment
Identify discharge risks and exemption gaps before Chapter 7 filing
What You Can Do
Analyze Chapter 7 bankruptcy petitions to surface discharge risks, classify non-dischargeable debts, and identify exemption gaps that could affect your case. You receive a prioritized risk report highlighting what debts won't be discharged, which exemptions are underutilized, and critical filing concerns that require attorney review.
Features
Calculate likelihood of discharge denial based on income, asset patterns, recent transactions, and debtor behavior. Flags potentially fraudulent transfers, preference payments, and lifestyle patterns that invite trustee scrutiny.
Identify all debts that survive Chapter 7 discharge including student loans, recent taxes, child support, alimony, criminal restitution, and fraud-related obligations. Explains why each debt is protected and what it means post-discharge.
Review state exemptions against debtor assets to detect under-protected or at-risk property. Highlights which assets have insufficient exemption coverage and calculates potential recovery for unsecured creditors.
Assess eligibility under the Chapter 7 means test using current income, family size, and state median thresholds. Flags cases at risk of dismissal and explains disposable income calculations that determine Chapter 13 eligibility.
Verify 6-month credit counseling completion, timing requirements for previous filings, and automatic stay implications. Ensures filing timeline meets 341 meeting, disclosure deadlines, and discharge scheduling.
Surface suspicious transfers to insiders, unusual asset disposition, or lifestyle changes within lookback periods. Explains trustee recovery risk and time windows for avoidance actions that could reclaim transferred assets.
Distinguish debts by priority (tax, payroll, child support owed to governments) and secured status (liens, mortgages, auto loans). Shows what must be paid, what can be stripped, and what gets wiped in discharge.
Example Output
Case: John D., Self-Employed, $185K Income, $280K Unsecured Debt
DISCHARGE RISK: MODERATE (65%)
- Income above state median; means test required
- Recent business loss but no recent large transfers detected
- Recommendation: Attorney review of Schedule J expenses for defensibility
NON-DISCHARGEABLE DEBTS ($58,500)
- Federal income tax 2022-2024: $34K (priority, survives discharge)
- Student loans (3 federal loans): $18.5K (discharged only if undue hardship proven)
- State tax lien: $6K (secured by property lien)
EXEMPTION GAPS
- Primary residence: $425K (exempt under homestead); protected ✓
- Business equipment: $45K (only $15K exempted); $30K at-risk
- Vehicle 2: 2015 Honda CR-V (second car, $12K value; zero exemption); full equity exposed
- Bank account: $22K (exempt up to $15K); $7K vulnerable
CRITICAL ISSUES
- Business asset under-exemption ($30K) — consult attorney on tools/equipment classification
- Two-vehicle household — consider selling second vehicle pre-filing to reduce estate
- Recent $25K transfer to brother (Aug 2025) within 2-year lookback — trustee may pursue avoidance
Case: Maria S., W-2 Employee, $58K Income, $92K Credit Card Debt
DISCHARGE RISK: LOW (28%)
- Income well below state median; passes means test
- No recent irregular transactions
- Eligible for immediate discharge without Chapter 13 conversion risk
NON-DISCHARGEABLE DEBTS: $0
- All debts are consumer credit and fully dischargeable
EXEMPTION ANALYSIS
- Rented apartment (no homestead); rent affordable post-discharge
- Car loan secured; equity $3K fully protected
- No other significant assets
TIMELINE: CLEAR
- Credit counseling certificate dated July 2026 (valid)
- No prior bankruptcy within 8 years
- Eligible for filing immediately
What's Included
- Discharge Risk Report: Quantified probability of discharge denial with factors weighted by trustee scrutiny likelihood and case law precedent
- Debt Classification Matrix: Complete breakdown of all debts by dischargeability status, priority tier, secured/unsecured status, and post-discharge obligations
- Asset & Exemption Schedule: Detailed exemption coverage for each asset class with dollar amounts protected and exposed, flagging under-exempted or at-risk property
- Trustee Scrutiny Flags: Red flags that invite heightened trustee investigation: fraudulent transfers, preference payments, unusual lifestyle or income patterns, undisclosed assets
- Pre-Filing Action Plan: Prioritized checklist of steps to reduce risk: asset disposition guidance, timing recommendations, documentation requirements, and attorney review triggers
Who It's For
- Bankruptcy attorneys and law firms
- Paralegals and legal assistants managing Chapter 7 caseloads
- Legal aid organizations assisting low-income filers
- Individuals evaluating Chapter 7 eligibility before petition
Best For
- Pre-filing risk assessment and triage
- Discharge eligibility determination
- Exemption planning and asset protection strategies
- Means test qualification analysis
- Trustee challenge prediction and mitigation
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