How can I file bankruptcy when I have no money?
7 tips
It often seems ironic, but bankruptcy can seem like a very expensive undertaking. Are you wondering how you can actually afford to file bankruptcy? It’s a conundrum we bankruptcy lawyers hear all the time. “How can I pay for a bankruptcy attorney if I’m so broke I need to file bankruptcy?” But if you take a moment to think about it, filing a bankruptcy case will save you thousands of dollars. It’s an investment in your future and one that will bring you an almost immediate return. Find the cash necessary to make this investment in your future.
- Start by Becoming Educated With a Free Lawyer Consultation.
Almost all bankruptcy attorneys will provide you with a free consultation where he/she can examine your personal circumstances and help you decide whether bankruptcy is a good option for you. The attorney can also address what type of bankruptcy would be best to file and when you should file. You can also bring up the options how you can pay for the bankruptcy. - Immediately Cease Paying on Your Credit Cards
If bankruptcy is inevitable, why not cease making any further payments on credit cards and other debts that will ultimately be discharged by a bankruptcy? Simply save the money you would have normally used to pay unsecured creditors (those with no collateral for the debt) and eventually you will have sufficient funds to begin your bankruptcy. - Use Tax Refund Money
Should you be one of the lucky ones to receive a federal or state tax refund in the Spring, these new funds can be a great way to pay for your bankruptcy and begin the road back towards a fresh start. - Shave Your Household Expenses
Look for creative ways to reduce your monthly expenses. Perhaps you can save the $5 a day spent on that latte or cut your cable in favor of a streaming service. Maybe you can start taking your lunch to work instead of spending $12 a day eating out. We have found that most clients can find an extra $100-200 a month using these techniques. - Money Received From Family and Friends
While it may be difficult and uncomfortable to discuss with situation with your loved ones, many debtors find that when they have reached out for help, they had many concerned people who want to help them out. Any loans (as opposed to gifts) made to you will need to be disclosed in your bankruptcy paperwork with the friend/relative listed as a creditor. Even though the loan will be discharged in the case, you still have the voluntary option to pay it back. - Work With Your Legal Counsel
Most bankruptcy attorneys will provide you the option to pay your Chapter 7 legal fees in payments but they will usually require that your fees be paid in full before the case is filed. For a Chapter 13 bankruptcy, however, the attorney fees can be included in your monthly Chapter 13 payment. Some attorneys will even permit you to pay you Chapter 7 bankruptcy fees over a 12 month period AFTER the filing has been made. - Absolute Last Resort Options
These last resort options should only be considered if you have no choice but to file bankruptcy right away without being able to wait, as they cost you more in the long run.- Finance Your Attorney’s Fees and Cost With Credit.
While you can try to obtain a payday loan, car title loan or an advance on your credit card and then discharge those same amounts in your bankruptcy, it typically does not work. If you take out a car title loan, you’re jeopardizing your vehicle and will have to pay the title loan company to get the vehicle released anyway. Using home equity loans can put your home in jeopardy if you have trouble making the mortgage payments later. Even if you can obtain a discharge from other creditors by using this option, the monies that were financed to pay for the bankruptcy typically will not be able to be discharged. Any debt you incur in the 90 days prior to filing bankruptcy – or with the intent of including it in a bankruptcy – may not be discharged, and in fact, you may even lose your right to a discharge under certain circumstances. - Make Withdrawals From Your 401(k) or IRA Retirement Account.
This money itself will be exempted when you file a bankruptcy case. If you use these types of funds to pay for your bankruptcy, you may incur penalties for taking early withdrawals or higher tax bills. Only if you owe huge amounts of money that will be discharged in a bankruptcy case will this option outweigh the inherent disadvantages.
- Finance Your Attorney’s Fees and Cost With Credit.
Take advantage of our month of July offer.
As a further incentive to act now, we are offering a 10% discount for the month of July. Just send a message through our contact form or call my direct line at (855) MY BK SOS to set up a convenient time to talk.