Are You Too Poor to File Bankruptcy?
Is it possible to be too poor to file bankruptcy? The answer to the question is no.
First of all, there are no limits on how much debt you have to have. No minimum amount or maximum amount. The bankruptcy code allows people to discharge debt in most chapters of bankruptcy. Especially with a chapter seven bankruptcy, there are no limits.
However, there are costs involved in filing a bankruptcy. If you want to hire a lawyer, it is a lawyers practice to charge his fees.
Some of my friends tease me about that. “How do you make money and be a bankruptcy lawyer? How do people afford to pay you?”
The answer is “They find a way”. If they are paying credit cards or for a car they are not going to be able to afford going forward, they stop paying those bills, save the money and then you can afford to file a bankruptcy.
Once you have stopped paying your credit cards, typically it is at least six and generally twelve or eighteen months before that credit card company is going to sue you. At that point, they are ready to garnish your wages or take some kind of drastic action to collect on that bill. So you have time after you stop paying the bills before you file the bankruptcy.
Also, people have things that they have free and clear, maybe a car that they don’t have a lien on. You can borrow. There are individuals or sometimes even a bank or a credit union, who will give you a loan against that vehicle. It’s perfectly okay to do. Then you use that money to file your bankruptcy. Remember, you do have to pay that money back if you want to keep that item.
So, there are options here and a competent bankruptcy attorney will help you explore those.
Some people choose to go on their own and there are places that will help you do that on your own. The bankruptcy court here in Arizona has a very good, helpful self-help center with a staff person who will help people prepare their own documents. I’m not offended by that if my people can’t afford me and they go there, that is fine.
I am making a living trying to help people through bankruptcy and so I help people try to figure out how they can get the money together to pay me too.
So, you don’t have to go without filing. You don’t have to fret about it, because it is no charge for the initial consultation with me to get the information and figure out what your options are.