There is no specific debt requirement that must be met to file for chapter 7 bankruptcy protection. In a chapter 7, the debtor may have as little or as much debt, assuming that he meets all of the criteria for a discharge. The debtor must make the decision as to whether he has the financial ability to deal with his debt without the benefit of a bankruptcy.
A certain amount of credit card debt may seem substantial to one person and low to another. Furthermore, even though the amount of debt may seem low, if a person is unable to make minimum monthly payments on the debt, or otherwise have the ability to payoff the debt, bankruptcy may be a feasible option.
An individual should make an informed decision about how to handle their debt as soon as possible. In other words, at the time an individual is experiencing debt problems, he should prepare a detailed budget to establish a plan for curing all of their debt. If the budget reflects an inability to payoff their debt, it may be time to seek advice from a bankruptcy lawyer. If a non bankruptcy budget plan is not established, the person may not realize the severity of their financial situation, until $10,000.00 later, after paying mostly interest.
One should consider the following issues with regard to their debt situation. An individual may benefit from a chapter 7 filing instead of using pension, 401(k), or similar funds to pay their debt. Consequently, these similar types of retirement accounts are protected from creditors in a bankruptcy case. Also, a person may meet the chapter 7 criteria for only a certain window of time. Furthermore, if a person is unable to meet their monthly minimum payments, the debt will likely spiral out of control due to increased interest rates.
You may contact New Jersey Chapter 7 bankruptcy lawyer Robert Manchel at 1 (866) 503-5655 if you are interested in filing for bankruptcy protection.