Frequently Asked Questions About Chapter 7 Bankruptcy, Chapter 13 Bankruptcy

When I declared bankruptcy, there was no one I could ask questions. I felt alone, scared, ashamed. When a friend began going through bankruptcy a few years, she called me with her questions about what to expect. Once, exasperated, she said, “rather than me bothering you every day, why don’t you just write this all down so I can read it in one place?”

So I did. I wrote Bounce Back From Bankruptcy to help my friend Michele and everyone else who was struggling with their decision to declare bankruptcy. I’ve made it my life’s mission to help people get back on their feet after bankruptcy.

There are a few questions that come up regularly about bankruptcy (and about my book!), so I’ve included them here to help you. If you have any additional questions that come up for you, check out the resources I’ve included and feel free to email me at PaulaRyan@artofabundance.com.

I’d like to order your book, “Bounce Back From Bankruptcy,” and would like to know when it was written, if it has been updated since the new bankruptcy law and if the list of credit card issuers (secured and non-secured) is still valid?

I appreciate you asking your questions up front to help you make the most informed decision about whether or not this book is the right book for you.

Please bear in mind that if you’re looking for a book that will help you immediately get back into debt again, then this is definitely not the right  book for you. This book is designed to help you change the way you relate to money in your life, so you can get a true fresh start after bankruptcy, whether or not you ever decide to get credit again.

The Fourth Edition of the book was published in September 2007and includes updated information regarding the new bankruptcy laws and what they mean for you once you declare bankruptcy. We also incorporated more information about people going through Chapter 13, especially if you’re struggling to make your payments under the Chapter 13 plan.

The book includes all the latest information on the best secured and unsecured cards being offered today for bankrupt consumers. In addition, the new edition includes the detailed step-by-step analysis I use when determining whether or not a credit card (secured or unsecured) is a good deal for you. Credit card issuers are constantly changing, due to bank mergers and because everyone wants a part of the profits that are available from newly-bankrupt consumers who are rushing to get a new credit card. The most important thing to do with any new offer (since offers change so frequently) is to use the criteria I used when selecting the best cards – I walk you through the specific criteria to use, when considering secured or unsecured cards.

I trust this will help you make an informed decision as to whether or not Bounce Back From Bankruptcy is the best book for you (remember, it does come with a money back guarantee if you’re not completely satisfied). Whether or not you choose to buy the book, I wish you all the best as you get back on track financially.

Can’t I just file bankruptcy by myself? Do I really need a lawyer?

You can file your bankruptcy yourself, but I rarely recommend it. It’s too easy to overlook something; bankruptcy laws are complicated and may be changing soon. You can file a Chapter 7 by yourself, but if you do this, please have a bankruptcy attorney review your paperwork before you file, to make sure everything is in order. Chapter 13 bankruptcies are much more complicated and I don’t recommend trying to file your own Chapter 13, under any circumstances.

What’s a good reference book if I’m considering bankruptcy?

There are two I recommend, both by the same author. Personal Bankruptcy For Dummies and  Debt Free: Your Guide to Personal Bankruptcy Without Shame by attorney James Caher. If you’ve decided to file bankruptcy without an attorney and do it yourself, I recommend any of the Nolo books by Robin Leonard.

How do I find a good bankruptcy attorney?

You’ll find a free attorney referral listing section here on my website that may help you find a consumer-friendly attorney. You might also want to also check with your state bar association for a referral. Most attorneys will offer a free initial consultation. I recommend going to two or three different free consultations with attorneys. Then go with the attorney you feel most comfortable with. This may or may not be the cheapest attorney. Remember: this is a big financial decision you’re making and you want to make sure all your questions are fully answered.

If you want to read more about the new bankruptcy law, or get a free consultation with an attorney in your area, click below to find Bankruptcy Lawyers. Attorneys & Law Firms for Filing Bankruptcy – where you’ll find bankruptcy lawyers, attorneys and law firms to help you on filing personal or business bankruptcy. This site provides bankruptcy information, chapter 7, chapter 11 & chapter 13 bankruptcy laws.

I can’t afford to go bankrupt. I can’t even afford to pay my bills – how am I going to pay an attorney?

When you make the decision to go bankrupt, the first thing you’ll be advised to do is stop paying your unsecured creditors (credit cards, mail order companies, doctors, etc.) whose debts you’ll be discharging under the bankruptcy. This should free up some money. Most attorneys will allow you to fill out the paperwork and then pay them monthly until you’re paid in full. Once you’re paid in full, they will file the papers for you.

Is there a rule of thumb for who should or shouldn’t file bankruptcy?

There is no cut and dried rule of thumb for bankruptcies, but I do have some basic guidelines that I try and share with people who are considering bankruptcy. Basically, if you’re judgment proof (meaning you have no home or car loan or assets for creditors to come after), and you don’t have any intention of buying anything on credit for 7 years (mortgage or car loan), there’s really no need for you to declare bankruptcy. A good bankruptcy attorney will point this out to you.

On the other hand, if your debts are more than three times your income, and you have limited possibilities for growth in income, there is a good chance that you’ll never get out from under the debt by paying off the debt yourself. Whether or not you should declare bankruptcy will depend on the types of debt, and whether or not the debt is dischargeable. Certain judgments and taxes aren’t dischargeable and student loans are rarely dischargeable, except under conditions of extreme hardship. If you find yourself losing sleep, sacrificing your family’s well being or thinking of doing something illegal in order to make money to pay your creditors, chances are bankruptcy may be a better option.

It’s called the bankruptcy protection law for a reason. It’s there to protect you and give you a fresh start. If you decide to declare bankruptcy, take steps now to make sure you don’t get into the same cycle again.


Three great references are my free Heal Your Relationship With Money Series of articles, my book, Bounce Back From Bankruptcy, and the free Do’s and Don’ts of Bouncing Back From Bankruptcy tip sheet.

Have a question about what to expect after you go bankrupt?
Bounce Back From Bankruptcy will direct you to the right answers!