At least twice a week I get a phone call that asks the question “How much do I have to owe to qualify for bankruptcy”. It’s a fair question, but not the right one. The real question is about your ability to pay. If you are unemployed, even a minimal payment can lead to ruin. Sometimes, even if you can make the minimum credit card payment, you may be better off filing bankruptcy.
One of our clients left a big impression. He had an average, middle management man with a house, a wife and an 8 year old son, when in the space of a little more than a year, he lost his job and his wife divorced him. He found a new job that paid about 31k a year, but was now forced to rent an apartment and he was unable to do anything except about $300 in minimal payments to the $8,000 he owed in credit cards. He decided to do a chapter 7 bankruptcy with us, because those $300 were the difference between a tiny studio apartment and just staring at TV with his son and a one bedroom apartment and being able to occasionally take his son out to a Marlins game or the Miami Zoo.
Each person or family is different in their financial circumstances. For some, the loss of a job or loss of a 2-person household income has left them stranded in dire financial straits, forcing them to overextend their credit just to keep their head about water.
Bankruptcy, while certainly not an easy process, if often the best option for individuals and families who face job loss, divorce or other significant, game-changing circumstances. It provides relief from creditors and can help get your family back on its feet a lot faster than other options. To be sure which choice is right for you, consult a qualified bankruptcy attorney.