The Final Report of the  American Bankruptcy Institute on Consumer Bankruptcy offers suggestions to make paying for bankruptcy more affordable. The report does a good job of explaining why fees are so high, but the suggested remedies are generally lame and at times just plain wrong. In what way? Well, the report correctly diagnoses the problems of escalating legal fees faced by debtors filing Chapter 7 cases, but the proposed recommendations to solve this problem…

Low income debtors often need to file bankruptcy to stop garnishments, car repossessions and foreclosures. The problem is, filing Chapter 7 bankruptcy is expensive and attorneys will not file a case until ALL those fees (typically $1,400 to $1,800) are paid. Why won’t attorneys file cases for a small retainer and monthly payments on the balance? Because court rules prohibit attorneys from doing that.  It’s ironic, but the very laws that are designed to help…

It costs a lot of money to go broke.  It really does. The cost of filing Chapter 7 in Nebraska is about $1,400 to $1,800 for the typical case, and many can never afford that cost. To make matters worse, once a bankruptcy petition is filed with the court, attorneys are not allowed to accept further payment. As a consequence, bankruptcy attorneys must charge ALL their fee up front before the case is filed.  And…

I recently returned to work after being a stay at home mom. When I quit working I stopped paying on one large credit card. They took this all the way to judgement and are now trying to garnish my wages with my new employer. I am a mortgage processor and am wondering if I file bankruptcy will it affect my NMLS? My second question is will I even qualify for bankruptcy at this point? The…

“So I’m not great with adult life, I’m 22, I’ve came into work today for my boss to tell me there’s a court order in which they’re garnishing my wages to pay off a debt. The thing is I have no idea as to where this debt has come from. The only time in my life I’ve ever had a letter about a debt is from long ago. Never received any letters about a court…

My parents passed away a year ago. I was estranged from them. My sister was the sole beneficiary of the estate and I was told I was getting nothing. I had my meeting with the bankruptcy trustee today and the trustee asked if I was expecting any inheritance in the next 6 months. I said no. I got home and my sister said she sold our parent’s house. She wrote me a check for a…

Here is the question posed in today’s Reddit debt column.   “So, as the title says. In total, between a few credit cards and a personal loan through Lending Club I owe about $25,000 in debt. Never missed a single payment in my life, never even been late with one. But my credit has gone way down simply due to the utilization ratio. Somewhere around 90% of my cards are maxed out and it’s…