Financial disaster is a difficult thing to cope with. The collapse of your income, savings, and wealth may owe to events and forces beyond your control. You may have struggled to keep yourself above water for months. But you have finally come to the end and need a hand to help you out of the ocean of debt you are drowning in. Declaring bankruptcy may be the best option for you.
In the past, bankruptcy was associated with life failure. This is no longer the case. Some of the most financially successful people in the country have had to go through multiple bankruptcies. The days of life-long employment and economic stability are over. You never know when you will lose your job or have to take on an unexpected financial burden. A sudden shift in your fortunes can put you into an untenable financial situation. If you have reached the breaking point, then you should file Chapter 7 bankruptcy.
Chapter 7 bankruptcy gives people with little or no income a new beginning. This type of bankruptcy will wipe away all your debt. The bankruptcy filing will remain on your credit record for 7 to 10 years and you will have a hard time securing loans or credit cards during that time period, but you will be able to re-build your life without the albatross of extreme debt.
There are costs associated with filing Chapter 7. Even if your financial problems are so bad that you now have no income, you can still file. The typical costs of filing chapter 7 include:
- Court fee
- Credit counselling and financial management courses
- Attorney fee
All of these costs can be avoided. For starters, if your household income is less than 150% of the federal poverty level, you are eligible to file chapter 7 for free. You can also ask that the fee for credit counselling and financial management courses be waived.
It is also possible to file for bankruptcy without an attorney. You can complete the bankruptcy forms on your own. There is a great deal of information and a variety of online tools that can help you do this. Most bankruptcies are pretty straightforward. They do not require the intervention or expertise of a lawyer. If you believe you can get through the process without legal assistance, then you should do so. It is one of the best ways to pursue a zero down bankruptcy.
If your bankruptcy is more complex and hiring a lawyer will help you get a better outcome, then you should consider other options for raising money. These include:
- Using your tax refund to pay attorney fees
- Sending the money intended for credit card bills to the law firm you hired
- Selling an asset that is not protected by an exemption
There are ways to get the protection of bankruptcy laws without paying all the fees and costs associated with filing for bankruptcy. You will need to use a bit of creativity and conduct a little research, but you can find the solution that is best for you.
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