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The True Costs of Putting Off Your Bankruptcy
Oftentimes, one of our clients’ biggest concerns is the cost of retaining a lawyer and the fees associated with filing. A thousand dollars to file, they reason, is not small potatoes. In fact, if they had that kind of money, they tell us, they wouldn’t need to file at all.
We understand that the fees seem to be daunting, but let’s consider the costs of NOT filing for bankruptcy protection.

Let’s assume you need a Chapter 7 bankruptcy to wipe out the vast majority of your debt, and your credit score is 625 right now (which is pretty decent; credit scores can range from 300-850). Let’s also assume your bankruptcy cost is $1200.00, which is currently an average fee for an Ohio or Illinois Chapter 7 bankruptcy.
Not filing bankruptcy will negatively affect your credit score. Every month you miss a payment or make a partial payment on any debt, your credit score goes down. The lower credit score leads to higher interest on future home loans and vehicle loans.

To use real numbers:
  • for a $200,000.00 home, the higher interest rate can cost you approximately $193,000.00 JUST IN INTEREST ALONE.
  • for a $25,000.00 vehicle, the higher interest rate can cost you approximately $10,000.00.

So, while Chapter 7 Bankruptcy should cost you about $1200.00, waiting to file and killing your credit for several months or years may cost you $203,000.00.
So, while Chapter 7 Bankruptcy should cost you about $1200.00, waiting to file and killing your credit for several months or years may cost you $203,000.00.

Waiting to file for bankruptcy will put you even further into the hole in ways that may affect you even after you file. Every month you keep paying your credit cards or medical bills causes you to fall further and further behind on investing for retirement, building your savings, or even paying your monthly mortgage or utilities on time.

To use real numbers:
  • if you start investing $400.00/month at age 30, and retire at age 65; you should have approximately $827,120.66 in the bank at that time. If you invest $0.00/month, because you are paying off old credit cards to try and “save your credit”, you will have $0.00 in the bank at age 65.
  • not having a savings account with enough money to cover your expenses for 4-6 months can be catastrophic in the case of an injury to you or even a major household item breaking down. Not having a savings account could force you to use credit with interest for daily purchases, which will start the cycle of debt again. You need a savings account, and if you aren’t putting money in it every month, you are exposing yourself to having another bankruptcy on your record in the future.
  • not paying your monthly mortgage or rent, or even your other monthly bills on time crushes your credit and leads you to having worse credit, being homeless, and still needing a bankruptcy. Why wait?
So, delaying the bankruptcy could cost you your retirement savings of over $827,000.00; plus leave you homeless and in bankruptcy AGAIN.

Waiting to file bankruptcy can adversely affect your overall health. What is the price of your sanity? I’m serious here… worrying about debt causes depression, divorce and anxiety, as well as other daily issues regarding your well-being. If you have a way to end the suffering, for $1500.00, would you do it? Chapter 7 bankruptcy may be that way out. Live again, you deserve it!

To use real numbers:
  • Depression, divorce and anxiety can cause you to lose your job, become unmotivated to find a new job and can cause more medical bills for prescriptions and doctor visits.
  • Total cost of your sanity? Priceless.

I’ve shown you how doing a bankruptcy now for $1500.00 can save you over $1,030,000.000 in the future and keep you from another bankruptcy and homeless in the above examples. Do you still think you should put off filing for bankruptcy?
You are worth more than letting your debt control you any longer. Your financial future depends on you making sound decisions from today moving forward. Forget the past, you can’t change it anyway. So take the first step forward, call David Enos today. 

Information on this website is based on general principles of law. They may not apply to your situation. Nothing in this article constitutes legal advice and no reliance should be placed on the legal principles set forth in this website. This is why you should personally consult with attorney David Enos about your case.
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