I Need to File for Bankruptcy but I Have No Money

Bankruptcy Types

• The two most common types of consumer bankruptcy are Chapter 7 and Chapter 13. With Chapter 7, some creditors may get paid, but many Chapter 7 bankruptcies end in discharging most debts. Under Chapter 13, the court determines how much you can pay creditors over a specified time frame. Some debts may also be discharged in Chapter 13. Both forms may allow for waivers or installment payment of fees for qualifying individuals.
  
  

Chapter 7 Waivers

• Under a Chapter 7 claim, you may request a fee waiver with the court that eliminates court filing costs associated with bankruptcy. You may qualify for a waiver if your income is less than 150 percent of the Federal Poverty Level. The poverty level adjusts each year, and waiver authorization is subject to court approval. You petition for a waiver at the same time you file for bankruptcy.
  
  

Installment Plans

• The courts offer installment plans for filing fees in both Chapter 7 and Chapter 13 bankruptcies. Under a payment agreement, you pay filing and administration fees in four installments over the course of 120 days. In some circumstances, the court may extend the deadline to 180 days, however, the entire filing fee must be paid prior to paying for attorney fees, if applicable. As with fee waivers, you must petition the court for an installment agreement.
  
  

Considerations

• A Chapter 13 bankruptcy may convert to a Chapter 7 if the court deems you unable pay creditors with an installment plan. If a conversion occurs, you may be able to waive the filing fee. Similarly, a Chapter 7 may convert to a Chapter 13 at the court's discretion, resulting in new filing fees. Failure to pay court costs may result in dismissal of your bankruptcy.
  
  

Attorney Fees

• If you plan to file through an attorney, shop around for attorneys to find the best rates. Many attorneys offer payment plans or adjust fees based on your situation. Additionally, check legal clinics sponsored by local laws schools or your State Bar Association as they may offer reduced rates or even free legal counsel through volunteer services.