It may seem obvious to state that if you are considering bankruptcy you are dealing with financial hardship and overwhelming debt. But what happens when your finances are so bad that you feel you can’t afford bankruptcy? Below are tips for those who feel they can’t afford to file.
While suggesting you get on a tight budget may seem obvious, what’s not so obvious is that a failure to track your spending can make it impossible to put aside the money necessary for a bankruptcy filing. Before you throw the towel in on filing bankruptcy, try to control your spending so that you can save cash.
While you aren’t required to hire a bankruptcy attorney, common sense says that unless you’re professionally trained as a lawyer you probably don’t know the law and how it pertains to your case. So be sure to shop around for a bankruptcy attorney who can fit your case’s needs and your budget. Remember, there are many types of lawyers out there—seasoned veterans, new law school graduates, and attorneys who are moving from one practice area to another. Many of them may be willing to give you a reasonable rate.
Find a Pro Bono Attorney
Many experienced attorneys set aside a certain amount of time each year to do cases for free. Check with the American Bankruptcy Institute’s Pro Bono Locator, at http://probono.abi.org to find a bankruptcy attorney who may be willing to take on your case at no cost.
Connect With Legal Clinics
If your income is very low you may find some legal help through legal clinics. These legal clinics offer legal advice and representation at low or no cost depending on your income. In addition, many of the attorneys involved in these clinics are experienced legal professionals and passionate about donating their time to help people just like you.
In most cases, representing yourself is probably a bad idea, but if you’re willing to do the research and take the time to thoroughly do a good job—being a pro se bankruptcy filer can definitely save you money. Below are few things you should consider before representing yourself:
- The complexity of your case. While it may be relatively easy to represent yourself in a simple Chapter 7 bankruptcy case, anything that’s complex—including creditor challenges and aggressive adversaries such as the IRS—might be taking a risk that’s just not worth it.
- The type of bankruptcy case. It’s a lot easier to represent yourself for a few months in Chapter 7 bankruptcy than it is to represent yourself in a three- to five-year Chapter 13 bankruptcy case.
- Time available. Do you have the time and energy to become a part-time attorney? If you have the responsibility of a household (spouse and children) or you’re not ready to commit copious amounts of time to your bankruptcy case, then now is the time to admit that.
Before deciding that you can’t afford bankruptcy, examine your budget and all the alternative options available to you.