Whether there is a minimum debt requirement to file bankruptcy is a common question. The answer is no, there is no legally defined minimum amount of debt you need to file either a chapter 7 or chapter 13 bankruptcy.
There are maximum debt limits in a chapter 13 bankruptcy though. You cannot have more than $419,275 in unsecured debt and not more than $1,257,850 in secured debt. (These amounts are as of April 2019)
Although there is no minimum on what amount of debt you can file on, if you have a smaller amount of debt, your attorney may explore non-bankruptcy options with you. This is so you can make an informed decision on what is best for you. For example, sometimes you may be able to settle the amount of debt you have for less.
The choice on filing a bankruptcy is yours
For example, if you have $5,000 in debt, but are receiving constant creditor calls, summons, statements, or harassment, you may want to do something. These collection efforts are keeping you up at night. The relief you would feel from the bankruptcy automatic stay would be a great benefit. When the bankruptcy is filed, the automatic stay goes into place. The automatic stays means your creditors cannot try to collect on the debt, during the bankruptcy and after the bankruptcy discharge. There are a few creditors excluded from the automatic stay. For example, criminal proceedings and some domestic support proceedings can continue.
CALL NOW FOR A FREE STRATEGY SESSION FROM A MN BANKRUPTCY LAWYER AT KAIN & SCOTT
What you decide to do with your debt is your choice. Your attorney will help you make an informed decision on whether filing bankruptcy is right for you. Visit www.kainscott.com to speak with an attorney today. You will be glad you did!
