A great article on the hurdles of filing for personal bankruptcy illustrates that people who are poor very often cannot afford lawyer fees (approx. $1000) to help them navigate the Chapter 7 bankruptcy maze. With Chapter 7, you can get your debts wiped out, and re-emerge from bankruptcy in better shape. People who cannot afford the legal fees, often choose to file for Chapter 13 on their own. Chapter 13 does not wipe out debt but requries the debtor to make periodic structured payments to clear the debts. The irony is that those who are able to afford lawyer's fees to help them with the Chapter 7 process almost always do better. Quoting from the article:
People who hire lawyers to help them file under Chapter 7 have their debts wiped away almost without fail, national filing data shows. And debtors with attorneys fare far better than those who go it alone, filing pro se. Studies show clear benefits for those who successfully wipe out their debts, from higher credit scores to higher incomes. Moreover, this sort of targeted relief can help buoy the broader economy.
Those who can’t afford attorneys often turn to bad options with predictably bad outcomes. Some try to wrangle the complicated bankruptcy forms on their own, risking costly mistakes. Others are lured by unregulated “petition preparers” who promise bankruptcy on the cheap. In Los Angeles, I found a whole industry of petition preparers who often flout bankruptcy laws because of a lack of enforcement.
Don't despair - there's help. There's a non-profit called Upsolve that helps people with the process, connecting them with a free lawyer from a participating non-profit and also preparing the requisite filings. (Full disclosure: We are not affiliated in any way with Upsolve.)
If you are desperate, this may be worth a try. If you know people who may benefit, please be sure to send them a link to the ProPublica article - they may be able to benefit.
Good luck!
Submitted March 25, 2018 at 02:37PM by arnexa https://ift.tt/2IRH6XQ
