About bankruptcy

Asked almost 3 years ago - Santa Monica, CA

I was involved in an auto accident a week ago and I am probably the one at fault. The other car with which I had accident has serious damage. Even though the other driver has full insurance, I think her company will ask me to pay for whatever they pay. Since I am a student, I don't have any income and I don't think I can afford that big amount payment. Can I claim bankruptcy? I don't have any company or something, is that still ok to claim bankruptcy? Cause I always think only people who has company can claim bankruptcy. Also, is that gonna affect me or anything? If after I claim bankruptcy, I get a job, is all my salary gonna be used to pay the insurance company still? I am looking forward to your advise. Thank you.

Attorney answers (4)

  1. Frank R Sariol

    Contributor Level 11

    Answered . There is no requirement for you to have a company in order to file bankruptcy (BK). You have to be 18 years old and have more debts than assets (things you own). The amount you would owe to the insurance company would be discharged (meaning that you would NOT have to pay that debt AT ALL). The insurance company would NOT be able to collect from you ever again.

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  2. Kelly Hope Zinser


    Contributor Level 14

    Answered . I agree that it is a bit too early to be considering bankruptcy since you don’t know yet if you are at fault or what, if anything, you may owe. You also asked whether the bankruptcy would affect you. A bankruptcy will remain on your credit reports for 10 years. It will reduce your ability to obtain credit at favorable rates during that time, although the degree of impact lessens as time passes. Once a debt is discharged you do not need to make payments on it and your wages cannot be garnished to pay the debt. Finally, it doesn’t seem that this is the case from the facts you listed, but a bankruptcy would not be helpful if you were intoxicated during the accident because those debts cannot be discharged.

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  3. Christian K. Lassen II


    Contributor Level 20


    Lawyer agrees

    Answered . You should cross that bridge if and when you come to it. You are not even sure if you are at fault.

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  4. Andrew Daniel Myers

    Contributor Level 20

    Answered . Different chapters of the U.S. Bankruptcy Code apply to individuals and/or entities. The most common chapters under which individuals file are chapter 7 and 13, while business entities usually file under chapter 11 and sometimes chapter 7.

    In your situation, without knowing much more about your financial condition, I would not recommend bankruptcy for you in that, without more, it may be like shooting a flea with an elephant gun.

    I assume you have no insurance, because if you did, this is exactly what insurance is for.

    Here is more general background information on bankruptcy:

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