How to File Chapter 7 With No Money

Unfortunately, you have to spend money in order to save money sometimes. That’s definitely the case with most bankruptcy filings across the nation. You’re basically drowning in so much debt that you have no money left over for filing bankruptcy. Luckily for you, attorneys at O’Bryan Law Offices have handled many consumer bankruptcy cases like this. If you’re wondering how to file Chapter 7 with no money, we can certainly help. Call us today at 502-339-0222 for a free consultation.

Chapter 7 Bankruptcy Basics

Chapter 7 bankruptcy is basically a form of personal bankruptcy, meaning that individuals can undergo this bankruptcy process. 

The names of the bankruptcy “chapters” are taken from the U.S. federal bankruptcy code chapters. “Liquidation bankruptcy” is another name for Chapter 7. Listed below are the debts that a Chapter 7 bankruptcy filing can generally wipe out:

• Medical bills
• Credit card debts
• Mortgage or car loans
• Income tax debt
• Student loans
• Personal loans
• All unsecured debts

It’s important to remember that Chapter 7 bankruptcy can’t wipe out all debts. If you file for Chapter 7, you likely won’t receive debt relief from child support, alimony, tax liens, court fees, and personal injury debts owed due to an intoxication-related accident.

Chapter 7 Bankruptcy Costs

Filing for bankruptcy is generally expensive no matter who you are. But if you’re already drowning in debt, the last thing you need is more debt from a bankruptcy filing. Listed below are the typical fees you have to pay during a bankruptcy case.

• Bankruptcy filing fees
• Debt counseling and financial management class costs
• Bankruptcy attorney fees

But if you’re really in a financial bind, it’s possible to avoid all of these Chapter 7 bankruptcy filing fees. With a simple application submitted with your bankruptcy petition, you can ask the bankruptcy judge to waive your court expenses if your combined family income is less than 150 percent of the federal poverty line. Additionally, you can request a filing fee waiver for debt counseling and financial management classes. 

How Much Are Chapter 7 Bankruptcy Attorney Fees?

Every law firm and every attorney will charge varying rates across the country. However, the average American attorney’s fees are approximately $1,500. But bankruptcy lawyer fees can range between $1,000 and $3,500 nationwide. Many law firms, including O’Bryan Law Offices, will offer a free consultation to discuss your financial situation with a bankruptcy attorney. We’ll also help you decide if a bankruptcy filing is best for you and set up a specific payment plan. If you don’t have much money to spend on the bankruptcy process, tell your bankruptcy attorney at O’Bryan Law Offices. We will work out appropriate court fees and bankruptcy fees for you.

Kentucky Bankruptcy Court Costs for Chapter 7

Filing for bankruptcy in a Kentucky bankruptcy court is generally affordable, depending on the chapter you’re filing for. You will owe $338 to the Kentucky bankruptcy court if you pay in full. This bankruptcy court cost breaks down to $245 for the filing fee, $78 for the administrative fee, and $15 for the bankruptcy trustee fee. But if payment plans are better for you, you can pay $84.50 in four installments. The bankruptcy court filing fees for the other chapters of bankruptcy are as follows:

• Bankruptcy Chapter 11: $1,738 in full, or four installments of $434.50 (for personal bankruptcy).
• Chapter 12: $278 in full, or four installments of $69.50. 
• Chapter 13: $313 in full, or four installments of $78.25.

Can I File for Bankruptcy Without an Attorney?

It’s certainly possible to file for consumer bankruptcy without a bankruptcy attorney if you’re trying to save money. People who do this are called pro se litigants. If your financial situation isn’t too complicated, you can file all Chapter 7 bankruptcy case forms on your own. So you may be wondering: how do I know if my situation is simple enough to file on my own? Basically, if the only property you own is your house and Chapter 7 can wipe out the majority of your debt, then your debt situation is simple enough to file on your own.

But filing for bankruptcy without the help of a bankruptcy attorney can leave lots of room for error and confusion. It’s possible that you could end up paying more than you would pay in attorney’s fees if you make too many mistakes. Additionally, if your financial situation is incredibly complicated, it’s best that you file a bankruptcy case with an experienced Kentucky bankruptcy lawyer. 

How to Check Eligibility for the Chapter 7 Filing Fee Waiver

If you don’t want to file by yourself but you still need to save money, you could qualify for a filing fee waiver from the Kentucky bankruptcy court. In order to check your waiver eligibility, you must file Form 103B, also known as the Application to Have the Chapter 7 Filing Fee Waived. Then a local legal aid society could assist you for free.

How to File for Chapter 7 While on a Budget if You Don’t Qualify for a Filing Fee Waiver

But what if your household income exceeds the federal poverty line and therefore you can’t qualify for a filing fee waiver? You may still pass the Chapter 7 means test even if your income exceeds the poverty threshold, but you may still find yourself in a bind due to other court fees. 

It may be tough to pay $338 up front, especially if you’re facing a wage garnishment. In that scenario, you can request a payment plan in order to cover the court filing fee. Your fee will likely break down into four installments. In order to request this, you’ll have to fill out Form 103A, also known as Application for the Individuals to Pay the Filing Fee in Installments. Along with your bankruptcy petition and your first installment that’s generally around $80, you’ll submit the payment plan application. Then your automatic stay will take effect which will suspend the wage garnishment. Instead of using part of your money for wage garnishment, you can use it to pay the remaining bankruptcy court filing fee.

Ways to Pay Your Bankruptcy Lawyer if You’re on a Budget

If you don’t qualify for free legal services and you need a bankruptcy lawyer who doesn’t break the bank, you could pay attorneys fees in a few different ways. Whether your bankruptcy lawyer is asking for a lump-sum payment or a payment plan, you could make payments through the options listed below.

• Utilize your annual tax refund for legal aid. Because so many consumers use their taxes to pay their attorneys, bankruptcy filings in March and April are higher than the rest of the year.
• Stop making payments towards unsecured debts such as medical bills and credit cards. Instead, put that money towards an experienced bankruptcy lawyer because a successful Chapter 7 bankruptcy case will wipe out that debt anyway.
• Sell an asset that’s unprotected by an exemption. A Kentucky bankruptcy trustee can sell any of your unprotected assets when you file bankruptcy in order to pay your creditors. Therefore, you can certainly sell an unprotected asset for its fair market worth and use that money to pay your bankruptcy lawyer.

If you tell an attorney at our law firm that you’re on a budget, they can suggest other realistic payment methods.

Call Bankruptcy Lawyers at O’Bryan Law Offices Today

If you’re ready for a fresh start in your financial life, filing for consumer bankruptcy may be the answer. Bankruptcy lawyers at O’Bryan Law Offices can help you file Chapter 7, Chapter 12, and Chapter 13 without charging you a fortune. We can also teach you the best ways to manage your finances responsibly through our credit counseling course. Call us today at 502-339-0222 for a free consultation.