QUESTION
How far in debt does one need to be to file personal bankruptcy?
Asked on Jun 15th, 2015 on Bankruptcy - New Jersey
More details to this question:
How far in debt do you need to be to file personal bankruptcy?
7 ANSWERS
Commercial & Bankruptcy Law Attorney serving Powell, OH
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Ronald K. Nims
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There is no lower limit on the amount of debt you must have. Some people file bankruptcy who have no debts - but they are being sued which would create a debt if they lose. Generally, it doesn't make any sense to file bankruptcy with less than $10,000 or so in debt. If your debts were $1,000 it wouldn't make sense to pay an attorney and court costs of more than $1,000.
Answered on Jun 16th, 2015 at 10:31 AM
Bankruptcy law does not specify a certain dollar amount, but the good faith test requires that you demonstrate that you are unable to pay your debts to obtain a discharge in bankruptcy. If after just paying necessary living expenses, the money you have left over will pay 25% or more of your debt over a 5 year period of time, then it could be said your bankruptcy was not filed in good faith. So if you have $100 per month left over in your budget, in 5 years, you could have paid $6,000. So you better have at least $24,000 in debt to pass the good faith test, since 25 percent of $24,000 is $6,000.
Answered on Jun 15th, 2015 at 4:05 PM
There is no set dollar limit. The BK Code assumes you are insolvent if you can not pay your debts as they become due.
Answered on Jun 15th, 2015 at 4:03 PM
Bankruptcy Attorney serving Madison, WI
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Richard B. Jacobson & Associates, LLC
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There is no specific dollar requirement. The main question is, how much does your present debt situation hurt? If it hurts too much in terms of emotional stress, or incapacity to provide for your and your family's deeds, then a bankruptcy is worth considering. Consult an experienced BR lawyer. He or she will have to consider not only your debts, but also your assets and the applicable exemptions, and various other questions. It's nearly always worth it. Good Luck.
Answered on Jun 15th, 2015 at 3:10 PM
Bankruptcy Attorney serving Livonia, MI
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Charles J. Schneider, P.C.
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There is no such amount.
Answered on Jun 15th, 2015 at 2:02 PM
Real Estate Attorney serving Florence, KY
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Linda S. Novakov & Associates, PLLC
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There is no actual amount necessary to file. The Means test is the standard by which the determination is made for filing. If you fall below or close to the median income level for the area in which you live, you will be able to qualify to file Chapter 7. There are a number of additional criteria which can reduce your median income qualifications should you be close to meeting the means test. If you are working, but can't meet your obligations, you should meet with a competent attorney to see if you qualify.
Answered on Jun 15th, 2015 at 1:37 PM
Bankruptcy Law Attorney serving Livingston, NJ
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Law Office of Stuart M. Nachbar, P.C.
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As long as you have more than one or two creditors, the amount does not matter. What matters is assets (Value of the stuff you own, cars, bank accounts, houses) and that it makes sense to file. You are not going to pay counsel 1,500 +a filing fee of 335 to discharge 1000.00 of debt.
Answered on Jun 15th, 2015 at 1:27 PM