Legal Question in Bankruptcy in Nevada

Bankruptcy for $1,700 in credit card debt

Bankruptcy is available to eliminate serious debt problems. Depending on your income, a serious debt problem can mean different things to different people. But the cost of filing Bankruptcy (filing fees, credit counselling, attorney fees) is not that far from the $1,700 the credit card company is sueing you to collect.

As a rule of thumb, I like to see debt of $20,000 or more (or 50% of the annual income) before recommending Bankruptcy. As with any rule, I do make some exceptions.

Sure, you could try to save some money representing yourself, but if you have read any of my other posts, you will see why that is financial suicide. The Bankruptcy laws are incredibly complicated. The "professional" petition preparers who assure you that they know it all are total liars. Think you have nothing to lose? Try having your tax refund seized because you didn't know what you were doing! Or watch yourself get audited by the US Trustee because you made a mistake that is considered a criminal offense!

Yes, you have a negative equity of $5,000 in your vehicle that you could eliminate, but you will still need to have a car to drive after you turn it in. The impact of the high interest may eliminate any advantage to eliminating that debt. It will be 8 years before you will have bankruptcy available in case you really need it for some unforeseen debt problem.

Want to save yourself some money? Contact Consumer Credit Counselling for help or contact the creditor's attorney and negotiate a settlement of that credit card debt. Good luck!