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Why being too broke for bankruptcy was good for me!

           bankruptcy CNN Money just recently published an article called “Too Broke to go Bankrupt”, I thought this article was right on time considering throughout this month I will be blogging about different topics on the subject of DEBT.  The title of the article was eye catching, because one might ask how could someone be too broke to be bankrupt, wondering if that is even possible.  But the article is not discussing how one can be too broke, in regards to the amount of debt they have accumulated; the article is highlighting how some individuals cannot even afford to file or pay an attorney.

Why I understand

I understand this topic so well, because I personally experienced the same financial hardship at one time; and that’s what triggered me to write this blog post “Why being too broke for bankruptcy was good for me”.  Back in 1999 when I was having money problems, I had lost my job; creditors on my back with a debt load of only $5,000 in charge of credit card debt.  Now of course I can look back and say “only $5,000”, but during 1999 that $5,000 felt like $500K.  My only source of income was unemployment, I was getting $300 either every week or every two weeks I can’t remember, but the only thing I wanted was freedom from my debts and for me bankruptcy was the solution.  So what did I do I went to this so call superstar attorney that a few of my friends recommended who was only 5 minutes away, I waited in his waiting room for over an hour, just for him to tell me after only speaking to me for 20 minutes, he could not file the bankruptcy because I did not have enough to pay him or court filing fees.  I was floored and in panic mode, what was I suppose to do.  We’ll the short version of the story is nothing happen, no bankruptcy was filed.  After talking to a few of my friends and me explaining to them that my debts were only $5,000, many of them said it’s not worth it, and guess what they were right.

You never know what the future will hold

Back in 1999 when I was going through my financial hardship I never knew what future plans were before me.  I never would have never foreseen obtaining an accounting license, a securities license or an insurance license; because back then I just wanted out of my misery of owing $5,000 in charge off credit card debt.  What ever plans you have for yourself, ‘God has something else in stored for you and I’m glad I went forward with his plans instead.

What is the lesson

The lesson I learned during this my financial hardship were three tips that I advise to others:

    1. Bankruptcy as a last option - Let bankruptcy be your last option and maybe not an option at all.  Your credit will be screwed for 10 years and if you can afford  an attorney the only person who benefits is the  attorney.  If an attorney can figure out that you can afford him and the filing fees, he’s not going to talk you out of not filing.
    2. Learn the laws - There are laws in put in place to help consumers from intimidating debt collectors, collection agencies cannot threaten or intimidate consumers.  Go to www.ftc.gov to learn how you can protect yourself.
    3. Learn the principles - Begin to learn and understand the principles of financial literacy, I didn’t know how to follow a budget or create an emergency savings, for myself and didn’t seek to learn how until it was too late.  I was spending money as if my job was going to last forever.  Lesson learned!

 


 

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8 Responses to “Why being too broke for bankruptcy was good for me!”

  1. It was really tough to pay the attorney for our bankruptcy, but it was necessary. My wife’s paychecks were getting garnished, to the tune of 25%, and we were only making $25,000/year at that point!

    • avatar Lorillia says:

      Garnishments are unfair, that’s why I emphasized in the article learning your rights. There’s a process that all collectors have to follow and they have to win a judgement in court. The unfortunate thing is that we as consumers, need to learn our rights, to fight back. I sympathize i had a creditor who won a judgement on me, but he couldn’t garnished my wages, because I didn’t have a job. I guess that was a good thing, but they did levy my bank account to get the money.

  2. Knowledge can definitely be powerful, especially when it’s coming from someone who knows what they’re talking about. I am glad you didn’t have to file bankruptcy for $5000.

  3. To this day, my wife swears she never got the notice for the case.

  4. avatar Lorillia says:

    Yes Edward that happens, especially if you moved to a new address. Because the creditor will not do a search to see if you moved, and they will serve an old address.

  5. Congratulations for all the changes that you’ve made.

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