So you’ve decided to file for bankruptcy and you can’t afford the expense to file for it. The question is then often asked if you can file for bankruptcy for free. We will be discussing the possibilities and the process involved of going about filing for bankruptcy.

Filing for bankruptcy can be a very expensive process. There are three main costs involved. First there are the the attorney fees, next the court costs and filing fees, and last there are the credit counseling classes.

There are new laws that require you to go to credit and financial management classes to help you to avoid filing altogether. These cost about $60. It is possible to get the classes free of charge but it is difficult process. The filing fess cost about $300 but it is the attorney fees that are the most expensive. You may be able to get legal services for free. To see if you qualify for free or pro bono legal services you should contact your local bar association. There are legal clinics that offer these services and you can find information about them on court websites.

It is possible to file for bankruptcy for free. The forms for filing for free are available online from the bankruptcy court in your district. There is a procedure in the bankruptcy code that allows the debtor to ask for bankruptcy filing fee to be waived.

There are several criteria that will determine if you can file for free. They are based on how bad your financial position is. You will have to submit every bank statement you have along with any other documents regarding your monthly expenses. It will take a lot of perseverance and you may still not get granted the waiver.

Bankruptcy is a complicated procedure involving both state and federal laws. It is not advisable to file for bankruptcy for free because it may cost more to fix the procedure than to initially pay for legal advice and retain a lawyer during the process. The process is very technical and if you miss a crucial step you may affect your rights.

Bankruptcy cannot be erased from your credit report. If you see services that offer this, they are almost always illegal services and should be avoided at all costs. The best thing to do is build up a new credit rating from scratch.

It is always recommended that you use a lawyer to assist you through the process. The process involved of filing for free takes a lot of time and administration, but can you file for bankruptcy for free? Yes it is possible, but not recommended.

This is the third installment in our bankruptcy series. Be sure to check back for updates…

Are you wondering whether or not you should file bankruptcy or explore bankruptcy alternatives? There ARE bankruptcy alternatives, but they may not be right for everyone. In order to decide whether or not you should file bankruptcy, you should first know the main reasons WHY people file, and then learn about what alternative options are available that might apply to your own unique situation.

The Main Reasons Why People File Bankruptcy

1.  They have more debt than they are able to pay back in a reasonable amount of time.

2.  They have more debt than they can pay back at all. In these cases, their minimum monthly payments on all their debts is more than their budget can handle without sacrificing necessities, such as rent and food.

3.  They want to avoid the embarrassment of having their wages garnished to pay back debt, since this would mean their employer would know about their financial difficulties.

4.  They want a fresh start with their credit. While your credit will be damaged for up to 10 years following bankruptcy, you’ll likely be able to start getting low-limit credit cards and small loans again within a year or two, which will allow you to get a new financial start and begin rebuilding good credit. This is attractive to many people who are considering filing bankruptcy.

5.  They realized that filing for bankruptcy will be cheaper for them than paying back their debts.

Bankruptcy Alternatives

1.  Debt counseling services: These services help you consolidate your monthly payments and obtaining lowered interest rates on unsecured debts. Counseling can have a negative impact on your credit, however, and will lengthen the amount of time it takes to pay back your debt.

2.  Debt consolidation loans: You can often get a low-interest loan that allows you to consolidate your debt into one monthly payment. This is convenient and allows you to pay back your debt quicker, and for less interest. However, be careful if you’re using your home equity to get this loan, as you could end up losing your house if you default on the payments.

3.  Debt settlement: You can often get creditors to agree to cancel your debt for less than the amount you owe. This is especially likely if you’ve had the debt for a long time. You’ll be able to settle for cents on the dollar of what you originally owed, but this will usually go on your credit report as having settled for less than the amount due, which can have a negative effect on your credit rating.

Before filing for bankruptcy, you should take all of the above information into account. If you’re able to pay back your debt in a reasonable amount of time, it may be worth your while to contact your creditors and try to work out a more equitable payment arrangement that will allow you to repay them without breaking your budget. Your credit will rebound much more quickly this way than if you declare bankruptcy. Once your creditors are paid, you can sometimes even get them to take the debt off of your credit report entirely, which will boost your score even more. A good credit score is important, as it allows you to get the best interest rates on mortgages and car loans, and can help you qualify for good jobs in the future (yes, employers often check credit reports before hiring). If you feel one of these bankruptcy alternatives is right for you, it’s a good idea to try them first.

 This is the second installment in our bankruptcy series. Be sure to check back for updates…

If you’re considering bankruptcy, then you’re probably curious as to the difference between Chapter 7 and Chapter 13. It’s important to know what each of these is, so you’ll know what to file. Your attorney will probably advise you of what he or she thinks is best for your situation, but to really be sure and know you’re doing the right thing for you, it’s essential that you know the basics. Knowledge is power, after all!

The main difference between Chapter 7 and 13 bankruptcies is how existing debts are handled. In Chapter 7 bankruptcy, most, if not all, of your debts are usually discharged. This means you do not legally owe the debts anymore, and your creditors can no longer come after you for payments. This is often accomplished without you having to sell any of your assets, as the majority of people filing for Chapter 7 bankruptcy don’t have any assets to sell. You won’t be forced to sell your house or car, either….especially if your car is your ONLY car. Chapter 7 is a good option for someone who is considering filing for personal bankruptcy based on excessive consumer credit debt.

Chapter 13 bankruptcy is different. It’s often referred to as a wage earners plan, and its main purpose is to create an equitable and reasonable repayment play for you to pay back your creditors. This type of bankruptcy is used by people who believe they can eventually pay off their debts, but not in a timely manner.

With Chapter 13, debtors are allowed to make structured payments in installments to creditors over a period of 3 to 5 years. Once the process is in motion, creditors are not allowed to start or pursue collection efforts against the debtor. In no case can the time of repayment be more than 5 years. This type of bankruptcy is most commonly used by people who are self-employed or operating unincorporated businesses. It is strictly for individual debtors, as corporations and partnerships are not eligible for Chapter 13. Also, the amount of both unsecured and secured debts being included in the bankruptcy must be within certain amounts set by statute.

The differences between Chapter 7 and 13 bankruptcies are pretty big, so it’s important to know which one is right for your situation. Despite being a financial setback, however, bankruptcy can ultimately give you a new financial life and help you restore your credit. If you’re thinking of filing, consult a qualified bankruptcy attorney for help and advice. It could be the best financial move you’ve ever made.

This is the first installment in our bankruptcy series. Be sure to check back for updates…