The crisis of bankruptcies in the last couple of years has slowed down somewhat, as fewer individuals are filing for Chapter 7 or Chapter 11 protection. However, many people are not declaring bankruptcy because they can't pay for to do so.
Slowing of meltdown
The financial industry meltdown caused an enormous surge of bankruptcy filings from 2006 to 2008. Part of the issue was also the in-crease in the joblessness rate. Deseret News explained that from 2007 to 2008, filings increased 33 percent, and it increased another 32 percent from 2008 to 2009.
In 2011, there was a 12 percent decrease in the number of bank-ruptcies field to 1.4 million, according to the New York Times. There were also decreases seen in 2009 and 2010, when filings for Chapter 11 and 7 increased only 8 percent.
The declining number of bankruptcies is encouraging. However, the counterpart to the data is, accord-ing to CNN, which more people would file for bankruptcy if they could af-ford it.
Filing bankruptcy will cost you
The typical cost for filing Chapter 7 bankruptcy is $1,500, which means about 200,000 to 1 million individuals throughout the nation cannot afford to really file for it, ac-cording to the National Agency of Economic Research. It is believed that many peo-ple use their tax returns to file bankruptcy.
The bulk of the cost goes to bankruptcy attorneys. Of the $1,500 total, $300 is the mandatory federal court fee for filing to declare bankruptcy. When individuals file for bank-ruptcy, they are required to take debtor's education courses and obtain pre-bankruptcy counseling, the charges for which add up to about $85 in most cases. That still leaves more than $1,000, most of which will go to a lawyer.
A less expensive way
Filing for bankruptcy is much more difficult now that the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act have come out. This is why there are so many expenditures and paperwork needed to file. That means that someone has to pay a lawyer even more cash to do all the paperwork. It makes it more difficult for the poor to declare bankruptcy, although the law was meant to keep individuals from filing for bankruptcy without cause.
A per-son can waive filing charges in some cases if their income is 150 percent or less of the federal poverty level. You may also be able to find lawyers that are willing to work without pay. There are some lawyers out there who are willing to do so.
Slowing of meltdown
The financial industry meltdown caused an enormous surge of bankruptcy filings from 2006 to 2008. Part of the issue was also the in-crease in the joblessness rate. Deseret News explained that from 2007 to 2008, filings increased 33 percent, and it increased another 32 percent from 2008 to 2009.
In 2011, there was a 12 percent decrease in the number of bank-ruptcies field to 1.4 million, according to the New York Times. There were also decreases seen in 2009 and 2010, when filings for Chapter 11 and 7 increased only 8 percent.
The declining number of bankruptcies is encouraging. However, the counterpart to the data is, accord-ing to CNN, which more people would file for bankruptcy if they could af-ford it.
Filing bankruptcy will cost you
The typical cost for filing Chapter 7 bankruptcy is $1,500, which means about 200,000 to 1 million individuals throughout the nation cannot afford to really file for it, ac-cording to the National Agency of Economic Research. It is believed that many peo-ple use their tax returns to file bankruptcy.
The bulk of the cost goes to bankruptcy attorneys. Of the $1,500 total, $300 is the mandatory federal court fee for filing to declare bankruptcy. When individuals file for bank-ruptcy, they are required to take debtor's education courses and obtain pre-bankruptcy counseling, the charges for which add up to about $85 in most cases. That still leaves more than $1,000, most of which will go to a lawyer.
A less expensive way
Filing for bankruptcy is much more difficult now that the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act have come out. This is why there are so many expenditures and paperwork needed to file. That means that someone has to pay a lawyer even more cash to do all the paperwork. It makes it more difficult for the poor to declare bankruptcy, although the law was meant to keep individuals from filing for bankruptcy without cause.
A per-son can waive filing charges in some cases if their income is 150 percent or less of the federal poverty level. You may also be able to find lawyers that are willing to work without pay. There are some lawyers out there who are willing to do so.
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