im in a IVA could i go bankrupt?
i have been in a IVA for 2 years now and just wanted to know could i go bankrupted and what sort of cost would it be.
- 7 years agoFavorite Answer
Regulations govern the bankrupt clause, you must owe a minimum amount of monies to your debtors before you qualify. Thats suppose to be the rule...
Technically, there is no minimum amount of debt that you must owe before you can file bankruptcy. But, when you consider that many attorneys charge anywhere from $1,500.00 to $2,500.00 for a chapter 7 bankruptcy filing (depending on how complicated) and that the filing fee alone for a chapter 7 filing is $299.00, it would make sense to owe more than that sum. Otherwise, just take the money that you would have spent on attorney’s fees and costs and pay your creditors.
But how much more should you owe before a bankruptcy filing is appropriate? That is a question that is hard to answer and a lot depends on you as an individual and your circumstances.
For instance, if you are not paying your unsecured creditors and you do not have any non-exempt assets subject to levy by the sheriff, there may not be much that creditors can do to you if you do not pay (North Carolina is one of the few states that does not allow wage garnishment.
If your state allows wage garnishment, that may be a reason in favor of filing bankruptcy). The creditors may get a judgment against you but that is probably not going to effect you a whole lot. Thus, a bankruptcy filing would get rid of the debt but you weren’t paying the debt anyway so what benefit was gained?
Another situation is where the creditors are constantly calling you and, according to the creditors, the only way they will stop calling is for you to pay the debt. If you are being hassled in this fashion but do not have a lot of debt (say $7,000.00 or so), you can tell the creditors to leave you alone (which should always be done in writing). The creditors are supposed to stop but sometimes they like to ignore this requirement. Or, perhaps you do not feel like shouldering this burden to notify creditors to cease and desist collection activities by yourself. In this instance, a bankruptcy filing will get rid of the debt and terminate the collection calls. Even though you do not owe a “lot” of debt, getting the calls to stop is of significant value to you. Therefore, a bankruptcy filing may be worthwhile to you.
Finally, there may be other reasons that favor a bankruptcy filing even though you do not necessarily owe a lot of debt. There may also be pitfalls as well. The main thing to consider is that, if you file a chapter 7 case and you do not owe a lot of debt, you will be prohibited from filing another chapter 7 for eight years. And your credit rating to say the least,"is shot" .
If you plan on getting back on track later, don't file ...just try to work with your people you owe! Most banks will not consider this in some cases and the reason is ; A re-sale could profit them many folds.
I have a friend who paid $200,000.00 for his house and his payments after add-ons were in the neighborhood of $ 1,200.00 per month. He lost his job after paying mortgage payments for twelve years.
The bank foreclosed and offered his house on the market for $ 245,000.00 ..the house sold after two months on the market. (the bank made a killing on this home)