Legal Question in Bankruptcy in California

Re: how much debt needed to file

Well, technically you don't have to have any debt to file. The bigger question is whether it makes sense for you to file given whatever amount of debt you have. If you would like a free phone consultation, please visit my webpage at http://www.bklaw.com/consult.html and then contact me to schedule an appointment.

Mark

Re: how much debt needed to file

There is no hard and fast rule. If the debt is relatively small compared to the monthly income, I encourage the debtor to try to work it out with the creditors directly or with the help of a nonprofit credit counseling organization. Remember, a bankruptcy stays on the credit reports for 10 years, and the debtor would be prevented from filing another Chapter 7 (liquidation) bankruptcy during the ensuing six years under current law. Feel free to call me for a free phone consultation during the week at (310) 858-9771.

Re: how much debt needed to file

There isn't a specific amount or percentage, but the court and trustees generally look at your "free" monthly income versus the size of your debt to see if paying your debt(s) off is feasible. If you can repay a large portion of the debt over 3-5 years, the court may convert your chapter 7 case to a chapter 13 case. It's best to get a consultation (or a couple) from a bankruptcy attorney who can look at your specific situation.