Americans: Too broke to go bankrupt

[Javaman]

http://finance.yahoo.com/news/americans-too-broke-bankrupt-105500347.html;_ylt=AlH0cR3ChGM3Wsp5qqrwLaSiuYdG;_ylu=X3oDMTNycGtkajNlBG1pdANGUCBUb3AgU3RvcnkgTGVmdARwa2cDNzRmMGNjMmYtOThlZC0zNTNiLWJiMGEtOWZiZjAzNzgxOTZkBHBvcwMxBHNlYwN0b3Bfc3RvcnkEdmVyA2Y1MDU0NDcwLTk4MzQtMTFlMS1iZDc2LTRhNmFhMjlkOTJjYQ--;_ylg=X3oDMTFpNzk0NjhtBGludGwDdXMEbGFuZwNlbi11cwRwc3RhaWQDBHBzdGNhdANob21lBHB0A3NlY3Rpb25z;_ylv=3

This year, hundreds of thousands of Americans are expected to be too broke to file for bankruptcy.

The average cost to file for Chapter 7 bankruptcy protection, the most common form of consumer bankruptcy, is more than $1,500, according to recent research submitted to the National Bureau of Economic Research.

As a result, anywhere between 200,000 and one million consumers are estimated to be unable to afford that steep cost this year.

The research, conducted by a group of professors from Columbia University, the University of Chicago and Washington University in St. Louis, examined how bankruptcy filings spiked after people received their tax rebates in previous years. They estimate that another 200,000 consumers, who would otherwise not have enough money to file, will use their tax refunds to pay for bankruptcy this year.


more at link...

[xchrom]

1. du rec. nt

[DLevine]

2. That is my situation. Can't afford it. n/t

[BlueCaliDem]

4. Why not do it yourself?

It isn't that difficult and there's a program online that will do all the schedules for you.

In California, the BK7 filing fee is $299.00. I believe that's the fee for all 50 states. You will need to call the court to ask what their filing requirements are, how to arrange your schedules, etc. In California, you only need two copies: one for the court and one for yourself. They will stamp both at no cost to you. Before, people had to file 6 copies with the court, but that's no longer necessary in CA since they do everything electronically.

But take note! There's that pre-BK filing course you have to take (thanks to Republicans and Democrats and signed into law by Bush) that's relatively inexpensive: $45. You can go online and do a search for pre-Bankruptcy courses in your area.This needs to be done before you file and you need to have completed and in receipt of the certificate (they will e-mail or fax it to you that same evening!) to be included with your filing otherwise it will be rejected.

There's another course you need to take, the post-BK course, but I would wait for the offers that come in after you've filed since there are some good deals out there. We paid $30 instead of $45! And both courses are simple to complete and you can take them online.

For the pre-BK course, we needed to speak with the credit counselor afterward, but that's really easy and there's really no pressure. They are actually kind! They basically want to know if you've completed the course yourself and if you had any questions.

I would do the post-BK course before the Creditors Meeting which happens about 4-6 weeks after filing. It has to be done before you receive your Discharge, so adding a copy of the post-BK7 certificate after you've filed, but before the Creditors Meeting (filing a copy is not necessary, but they like it) shows the Trustee that you're on top of things.

You can start filling out your petition and schedules using this online BK-7 program currently costs $89 (http://guaranteedbankruptcy.com/guaranteed/index.asp) and is very easy to use. It does everything for you, and it's comparable to the software used by BK attorneys. But remember that your file is only good for two weeks! You can make 20,000 changes and print out 20,000 copies within that time at no extra cost to you, but you only have two weeks to do it so please make sure you have all your paperwork together.

We've used this and our BK-7 sailed through and it was strange to see people represented by BK Attorneys were being turned away one after the other while we sailed through. This program WORKS! Also, when you have your Creditors Meeting (you get your appointment to appear via snail mail after you've filed), be sure to remember two very important things.

One, the creditors meeting is for your creditors. Thus, the Trustee (ours looked like Barbara Boxer!) is not there for you. They are there for your creditors since filing BK-7 puts you under the protection of the Federal government and creditors need to be represented, too.

Two, don't forget to bring two years of filed income tax returns! Some states only need one, but in California, the most difficult BK court in the union, btw, they required TWO. I've watched countless people being turned away at the Creditors Meeting because they forgot to bring copies of their income tax filings. I would take the last two years just in case. If you don't have copies of your filed income tax returns, you will be sent away. That isn't a big problem since they'll just ask that you make another date, but you want to do this right the first time.

All in all the whole process (if you take the onling Bk-7 special price of $89 dollars) will cost you less than $500, and you'll be doing it correctly the first time.

Hope this helps and you get your deserved fresh start!

[Th1onein]

5. You are terrific, BlueCaliDem!

I don't need to file for bankruptcy, but it's so nice to see someone, like yourself, who is willing to spend the time and effort to educate others.

[BlueCaliDem]

6. Means Test via NOLO for free!

Also, the BK reform wasn't as bad as most people think. Most people who qualified for Ch7 (Liquidation) before the BK Reform are still eligible today. They can take the online "means test" offered through NOLO to see if they qualify: http://www.nolo.com/legal-encyclopedia/chapter-7-bankruptcy-means-test-eligibility-29907.html

Timing is everything! NOLO advises bankruptcy filers with primarily consumer debts, not business debts, to take the means test. To take the means test, you must first determine whether your income is more or less than the median income in your state. If you earn more than the median, you must figure out whether you would have enough left over, after subtracting certain expenses, to repay some of your debt.

NOLO advises those with larger incomes to ensure to use the last six months of income when it was at its lowest in order to pass the means test. That's how they calculate the median in your state and whether or not you qualify for Ch7. The online Guaranteed Bankruptcy service asks that you do a means test, too. NOLO advises to calculate it this way by taking the last six months of income and divide that by 12.

Nolo is a godsend! They are consumer Attorneys who really care about ordinary folks.

And I really do want to help people who were in the same financial straits we were. I know how horrible and frightening it is, and I know how liberating and wonderful it is afterward. People who have gone through BK7 can immediately begin building their credit since, even before the Discharge, we received pre-approved offers from credit cards and have three each today, building our credit for almost a year. Oh, and we got a car loan for my daughter, too. True, it's expensive, but she now has a brand-new Honda Fit Sport with all the bells and whistles, and she pays the monthly payment herself so it's no skin off our backs.

As we were waiting for our turn at the Creditors Meeting, my husband looked increasingly worried at me as one after the other, people and their counselors, were being turned away. Some had attorneys with them who didn't even bother to tell them about bringing two years of tax returns! I mean, really? Btw, I learned that at NOLO, too.

My husband, no hero when it comes to things like this, was scared, but I was pretty confident. When it was our turn and after we were sworn in, the Trustee asked for our income tax returns and I handed them to her. She asked the usual questions like, "Have you listed all your information to the best of your knowledge?" Then it was over, she smiled and shook our hands, and said, "You'll receive your discharge in 4-6 weeks." All in all the Creditors Meeting only took about 10 mins and we were finally free to start fresh, unburdened by past debt.

[closeupready]

9. Thanks!!!! You are the best!

nt

[leftyohiolib]

3. 1500 to file papers? what a racket

[jwirr]

7. And those of us who fit that discription are going to get harrassed for the rest of our lives but

not just us but all of our relatives.

[G_j]

8. K&R