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To file for bankruptcy or not?

Location: Kalamazoo  |  Law type: Bankruptcy law attorneys

So I have a bunch of outstanding debt and 3 of the debt collectors have filed court cases against me. One of them has a Judgment Lein and 3 of them have wage garnishments in place.

I submitted a request for installment payments through the court with one of the three to get the wage garnishment disposed of. So with this particular one I started making payments at the end of February 2022 of $25/wk and the balance is $5,526.11.

I was trying to work out settling for a lesser amount of money with one of the creditors because they are the ones who I owe the most to and also are the ones who have a Judgement Lein against me. Their 20% discount if paid in one lump sum would be $9183. My only option available to me was to cash out my 401K. I have no stocks or bonds. I have no savings of any kind. Cashing out my 401K as much as I didn't want to was my only option. I had just upwards of $13,000 in my account and after cashing out from taxes taken out and the 10% early withdrawal fee I was only going to get back $8,400. I called back to re-negotiate and see if they would be willing to meet me at the $8400. At 1st the answer was no, but the 2nd person I spoke with spoke to his district manager and said that they would take $8700. This was still going to leave me short to close out this account on top of the fact that I'll still have other outstanding accounts that will need to be taken care of as well.  

I spoke with my husband and asked if he'd be willing to do a home equity loan on the house or a cash-out refinance and he's absolutely 100% against it will not even discuss it. 

So now my hands are tied and I don't really know what to do because I can't come up with all of the money to pay all of them off. In total for all owed to all creditors is around $20,467.94 plus accured interest. I made just over $17,500 in 2021.


So my question is I was wanting to know if it was thought to be a good idea to file bankruptcy at this point or should I continue on trying to take care of these on my own?


I'm supposed to call to make the payment of $8,700 to them by this Wednesday, April 20th, 2022. 


Thank you for your time

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Would you like to find an experienced bankruptcy lawyer near me (you) quickly and for a good price? Generally, bankruptcy law can provide a timeline (arrangement) for the repayment of non-dischargeable personal (corporate) debts. The ability to repay secured debts is valid for both Individuals as well as organizations (governmental and private). Bankruptcy comes in five varieties where each offering different options "settling" with debts.

  1. Chapter 7: Cancelation of unsecured debts (credit cards and personal loans). Bankruptcy law in the United States has changed dramatically in 2005. Liquidation of personal debts under a Chapter 7 is the most common form of debt relief. Most of chapter 7 cases are classified as "no asset".
  2. Chapter 9: Reorganization of municipalities and related local entities sheet (not for Individuals and Corporations). A chapter 9 of bankruptcy law in U.S is very special. It is a form of debt reorganization (not disposal). Remember, it is only avaliable to Municipalities
  3. Chapter 11: This chapter Provides a lot of options to reorganize debt. There are options such as "debt cancellation", repaying some debts for Individuals, etc ...
  4. Chapter 12: Restructuring of debts for Family Farmers is done according to this chapter.
  5. Chapter 13: repayment of some debts over a period of three to five years + reduction on secured debts and their elimination.

Is it better to file for a bankruptcy under Chapter 11, Chapter 12 or Chapter 13? It depends on your case. Your first step should be finding and hiring the best and most affordable bankruptcy attorney near you. Bankruptcy proceedings in the United States are (should be) supervised by District and Bankruptcy Courts governed by the bankruptcy rules (promulgated by the Supreme Court -

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