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I'm Broke, How Can I Afford a Bankruptcy Attorney?

Posted by attorney Clint Dunaway

Stop paying debts that will be discharged in the bankruptcy. Many people contemplating bankruptcy are currently paying debts that will be discharged in their bankruptcy. Typically unsecured debts are discharged. Unsecured debts include things like: credit cards, pay-day loans, medical and dental bills. By no longer paying on these unsecured debts people are often able to pay off their attorney’s fees in a month or two. From the moment you decide to file for bankruptcy is no longer makes sense to continue paying on your credit cards. Because whether you’re current on a credit card or haven’t made a payment in a year it doesn’t matter. All of the principal, interest, late fees, penalties, over-limit fees, and whatever else fee the credit card company can think of is going to be erased. Whether you have $30,000 in credit card debt or $130,000 it doesn’t matter because it is all going to be eliminated in the bankruptcy. From the moment you decide that you want to file for bankruptcy consider no longer making payments because any money you give your credit card company or other unsecured creditor is just throwing good money after bad money.

Giving up your house? Can’t afford your underwater house and know that you want to surrender it in the bankruptcy? Then you may want to consider no longer paying the mortgage. You can stop paying on the house and live in it free until after it has been foreclosed.

Tax Refund: Are you among the millions of Americans that receive tax refunds each year? If so, you can put that tax refund to good use by paying attorney’s fees with it.

Gift from a family member or friend. Do you have a rich uncle who would be more than happy lending you a few bucks for a worthy cause?

401(k) Loan. Do you have a 401(k) with your employer? Then you should be able to borrow against it. Speak with someone in your HR department to find out the details.

Life Insurance Loan: If you have a “Whole" life insurance policy—a policy with a cash value—then you should be able to borrow against. Speak with your insurance agent to learn all the details.

More hours at work? Are you one of the lucky few who can pick up more hours at your job? Or what about picking up a second job? Is there a non-working spouse who could get a temporary job? Do you have working age kids who could get temporary jobs?

Roommate? Could you move in with someone else to cut down on living expenses? Not only will this cut down on rent but also cut down on other things like: electricity, gas, cable, internet, and insurance. Or what about getting a roommate? Do you have an extra room in your house that not currently being used?

Sell something? Could you hold a yard sale? What about Craigslist? Or a Pawn shop?

Cut out or cut on unnecessary monthly expenses: Take a close look at your monthly bills and see what can be reduced or eliminated. Can you live without cable TV, pest control, alarm system, or your home phone?

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