Paying for Bankruptcy

Paying for Bankruptcy

Perhaps it seems ironic, but filing for bankruptcy protection costs money. There are court filing fees, trustee administration fees, attorney fees, credit counseling fees, etc. After learning about the costs involved, some who could benefit from bankruptcy protection may end up wondering, “Can I afford to file bankruptcy?” In a good number of cases where bankruptcy is appropriate, the answer is “yes.” If bankruptcy protection would be beneficial in your case, your bankruptcy attorney can advise you on how to afford it. Here are some examples of ways to pay for bankruptcy:

Stop paying unsecured creditors. Always do your utmost to pay the bills that cover the essentials of life: your mortgage, your electric bill, your car payment (assuming you’re not driving a Ferrari), etc. Many times, the other bills can wait. The money that you would otherwise send to these creditors can help raise money to file bankruptcy.

  1. Borrow money from a family member or friend. The legal obligation to repay the loan will generally be discharged in bankruptcy, but after you receive a discharge, you’re free to repay any debt voluntarily.
  2. Borrow money from your retirement fund. Just be aware that you will have to repay the loan within a certain amount of time to avoid a penalty.
  3. Try crowd funding. There are all kinds of websites out there that can help you ask family, friends, and total strangers to help fund your personal cause. GoFundMe is just one example of such a site. Or set up a PayPal account, and ask your Facebook friends to donate $5. Of course, this will require sharing personal details on social media, and only you can decide if that’s something you’re comfortable with.

Bankruptcy protection could benefit many people struggling with debt. A bankruptcy attorney can analyze your options, and give you advice going forward. Your initial consultation is free at Mills Law, so it won’t cost you a dime to find out what your options are. A fresh start might not be easy, but it can certainly be worth it.

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