Can I File Bankruptcy With No Income Coming In? – Ann

“Dear Lewis,

Massive student loans, went to grad school, and now can’t find a job in my field, theatre. 50,000 plus and rising, with interest adding up. Not employed at present, did the credit card thing for years, paid the minimum when I was employed at mostly low-paying jobs. Credit card debt about twenty five thousand. I did contact both credit card companies before the crap hit the electric fan, but was offered no help. Everything since then has been turned into collections. I have been deferring the student loans, which has a monthly payment of over three hundred fifty a month.

I did try to begin Chapter Seven Bankruptcy when living in California, but was unable to finish paying the eleven hundred dollar fee. I am now back in my home state of Oregon, which has even less jobs than SoCal but my family is here and I have a place to live. Is there a way to begin bankruptcy again even when you have absolutely no income coming in other than a few tiny royalties from your work? [ Royalties for short plays in the ten to twenty dollar range, no kidding. ] I was led to understand a lawyer can’t begin this process unless paid in full, which I understand, as it is their time and training, etc. So what can I do? I paid my bills on time all my life and now cannot. I have the number of the local legal aid for Oregon, but am rather dreading someone saying, too bad, do you have a gun? What can I do? I have nothing to sell, no house or furniture, and I have been in freefall and need this all to stop.


Dear Ann,

It is true that no bankruptcy attorney wold normally file a chapter 7 bankruptcy until the fee is paid in full. If they were to file with you still owing the money, then this debt would be discharged just like the credit cards and other dischargeable bills.

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Is it possible for you to borrow the money from a family member to get the chapter 7 filed? You could then pay that back after your bankruptcy is over.

I assume you are no longer paying on the credit card debt. If you are, then stop paying if you are definitely going to file bankruptcy. There is no sense in paying them anymore.

Hopefully you can start saving up, or better yet, start chipping away at an attorney fee. Since you have almost no income and no unexempt assets, there really isn’t anything any of the creditors can do to you. There is nothing to garnish and nothing to seize.

As to legal aid, every area is different. I have no way of knowing whether they would help, or because you might have family support, that you don’t qualify for aid.

Normally, I am completely against petition preparers instead of using an attorney. Petition preparers can not give legal advice. I have seen people who think they have no assets, but in reality they do (like a child who has no idea that her parents put her on the deed to their free and clear house, a joint checking account, etc).

So you understand the dangers of not using an attorney. If you understand that, but are still confident that there is nothing anyone could take in a bankruptcy filing, including the trustee, then you might consider filing the case on your own to save the money you don’t have.

I hope this helps you make an informed decision. Good luck!

My name is Lewis Roberts and I’m an attorney licensed in Florida and Georgia. My practice focus is consumer bankruptcy, real estate issues/closings, and mortgages. I also have Florida real estate broker and mortgage broker licenses. I am a proud member of the National Association of Consumer Bankruptcy Attorneys (NACBA), National Association of Consumer Attorneys (NACA), and a graduate of Max Gardner’s Bankruptcy Boot Camp. I enjoy helping people with decisions that impact their financial well-being.

Legal Disclaimer: This is for educational purposes only. It is not to be relied upon as legal advice. It also does not create an attorney-client relationship. No such relationship is formed with attorney without a written agreement.

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If you have a bankruptcy question you’d like to ask just use the online form.

4 thoughts on “Can I File Bankruptcy With No Income Coming In? – Ann”

  1. Thank you for the great advice, and for laying out all options. The crap has hit the fan and so forth, and I’m trying to hold it together long enough to take care of this problem. I went to the local legal aid office but they don’t handle bankruptcies, but the lawyer there did give me a form to file with the courts as I got served papers. It will be okay, it will be okay is becoming my frantic mantra. Because I don’t believe that at all. But anyway, life goes on and on and then it’s over, right? That’s a very cheerful thought right now.

      • Yes, it will. Just  working through what I have been so stupidly avoiding is what’s needed right now. Am talking to a lawyer soon and getting help from my family. Once you’re in a hole, you need to stop digging, as Molly Ivins once put it. Thank you so much for all the help.


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