It’s strange to think that bankruptcy costs money. How are people who don’t have money supposed to be able to pay for bankruptcy? The answer, unfortunately, is that bankruptcy does cost money; however, there are ways New York bankruptcy debtors can use the justice system affordably to gain their fresh start. I discussed this issue last year when The Wall Street Journal ran an article on a software company that was trying to make bankruptcy more accessible.
(Click to read “When Debtors Are Too Poor for Bankruptcy Filing Fees.”)
Here are some other options for making bankruptcy (and even hiring a New York bankruptcy lawyer) cheaper.
(1) Reduce your debt payments. If you plan on filing bankruptcy anyway, then there’s no reason to keep paying the debts you intend to discharge. Ideally you will want to keep the savings from the reduced payments in a separate account to prevent creditors from accessing it electronically, but even lowering monthly payments to the minimum will make bankruptcy more affordable.
(2) Borrow the money to file. In the earlier post, I discussed borrowing money from conventional lenders to pay for bankruptcy, the idea being that they would dispute the dischargeability of the money the lent out as a cash advance or luxury purchase. Additionally, though, debtors can go to nonconventional lenders to help pay for it: friends, family members, even their employers. The difference is that even though these loans would be dischargeable, debtors would want to repay them in the future anyway out of loyalty, which is allowed.
(3) Reach out to a legal clinic or lawyer interested in pro bono or “low-bono” work. Some lawyers offer to help a certain number of bankruptcy debtors on a reduced basis to serve the public. In most cases, however, they will try to help people who are really struggling, so debtors who are in bad shape but not in hopeless conditions, e.g. they’re too disabled to file themselves, probably won’t be able to take advantage of these kinds of offers. As for legal clinics, there are too many to count in New York City, but there may be a bankruptcy clinic at one of the dozen or so law schools in the area.
(4) Contact a lawyer who offers free initial consultations. An experienced Brooklyn bankruptcy lawyer will know better than anyone else how much it costs to file bankruptcy and how difficult it is to afford it. At a free initial consultation, you can discuss payment alternatives.
Bankruptcy won’t get any cheaper in the near future, so debtors will need to access the system as efficiently as possible. If you are experiencing financial difficulties then talking to an experienced New York bankruptcy lawyer is the best way to strategize your options.
For answers to more questions about bankruptcy, the automatic stay, effective strategies for dealing with foreclosure, and protecting your assets in bankruptcy please feel free to contact experienced bankruptcy attorney Brooklyn NY Bruce Weiner for a free initial consultation.
