Bankruptcy is an excellent means of debt resolution. Individual, qualified counsel in your area can advise whether that generality applies to YOUR debt. This answer (as well as our Web site) doesn't address all facts & implications of the question; it's general info, not legal advice to be relied upon; it creates no attorney-client relationship; it may be pertinent to CA only; it's independent of other answers. Hire legal counsel before acting or refraining from bankruptcy/legal action.

Answer Applies to: California
Replied: 1/4/2012

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Call a certified specialist in bankruptcy law and ask for a free consultation. This will allow your attorney to consider all of the relevant facts and give you the best advice.

Answer Applies to: California
Replied: 11/18/2011

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I am afraid your question is too broad based on the limited information provided. A good rough rule of thumb is bankruptcy may be the best option when your unsecured debt, not counting car loans mortgages or student loans, is more than half your annual income. The day you file bankruptcy, an automatic stay immediately stops all collection activity including garnishments on judgments.

Answer Applies to: Kansas
Replied: 11/18/2011

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Bankruptcy may be a good solution to get a fresh start and avoid harassment and having to do to court on debt collection. Everyone's situation is unique so if in doubt, seek an experienced bankruptcy lawyer for advice.

Answer Applies to: Indiana
Replied: 11/18/2011

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First of all, be very careful dealing with debt collection law firm. Most, but unfortunately not all, debt collection attorneys are ethical, but remember their sole purpose is to get as much money from you as they can. It is possible to settle debt, but you need to have a substantial amount of cash. BK may be your best bet.

Answer Applies to: Colorado
Replied: 11/18/2011

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The answer is maybe. You should go in an see an attorney to be sure. Most Bankruptcy attorneys offer a free consultation. There are too many factors just to say yes or no.

Answer Applies to: California
Replied: 11/17/2011

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The worst thing to do is to talk to the people that sued you. Stop! Meet with a lawyer to weigh the pros and cons of bankruptcy.

Answer Applies to: Georgia
Replied: 11/17/2011

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It is an option. Without knowing the whole picture, I couldn't recommend it or not. In bankruptcy, you don't usually settle debts, but rather, get rid of them entirely. I think you should talk to an attorney before you take further action.

Answer Applies to: Texas
Replied: 11/17/2011

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Bankruptcy is always a good option. Congress enacted those statutes for you. The sign on my door says "Bankruptcy is not a bad word."

Answer Applies to: California
Replied: 11/17/2011

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Bankruptcy could be a good option for you because it would prohibit the bank from coming after you for your outstanding balance owed on the Credit Card. However, you need to evaluate your whole situation with regard to what property you own, what other debt obligations you have, how much you are currently making, etc.. to see if bankruptcy is right for you. Without knowing these other factors, it is not possible to tell you if bankruptcy is the best option.

Answer Applies to: Nevada
Replied: 11/17/2011

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It sounds like it is your only option but you need to have a consultation with a bankruptcy attorney first to determine your eligibility and if there are any potential problems with your case, particularly since you have been living on credit cards.

Answer Applies to: California
Replied: 11/17/2011

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It is a good option and sometimes the best if it suits your goals.

Answer Applies to: Michigan
Replied: 11/17/2011

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Your question is to vague to give a definitive answer to, but I can give you some general guidelines to consider. I would urge you though to contact me or another bankruptcy attorney ASAP to discuss your individual situation in more detail. If you only have credit card debt (a kind of unsecured debt, meaning that the debt is not secured against any kind of collateral), then the big questions to consider are... 1. What is your income? - To do a chapter 7 bankruptcy, you must pass a means test, meaning that either you and your household's total income for the previous six months is less than the median income in your area, or you have special circumstances that would enable you to make more income (these special circumstances are beyond the scope of this quick answer). If you are struggling to pay your credit cards, you probably will pass the means test, but you won't know for sure until you run the numbers. 2. How much debt do you have that you want to discharge in bankruptcy? - If you only have a small amount of debt (say less than a few thousand dollars), it may not be worth your time and money to file bankruptcy. 3. Are you collection-proof? - This question means, do you have any assets that a creditor could take from you if they got a judgment against you? This will vary depending on your state. In Oklahoma, creditors can take up to 25% of your wages, they clean out your bank accounts, they can take away boats and recreational vehicles, they can even take away your car (if the equity exceeds $7,500). However, creditors cannot take social security, so if your only income is SSI and you have few assets, you may very well be collection proof. There are a lot of other factors here, so the only real way to know is to talk to a bankruptcy attorney. Most local attorneys offer free or low-cost initial consultations. It would be worth your time to talk to an attorney I think.

Answer Applies to: Oklahoma
Replied: 11/17/2011

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Yes. Bankruptcy is good option if you qualify.

Answer Applies to: Texas
Replied: 11/17/2011

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If your debt is too large to pay even with a payment plan you should consult with a bankruptcy attorney. There may be other options such as a credit counseling firm such as MMI, Money Management International.

Answer Applies to: California
Replied: 11/17/2011

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If you can't reach a settlement with the attorneys, then yes, bankruptcy would be your best option.

Answer Applies to: Colorado
Replied: 11/17/2011

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It could be. A lot depends on your circumstances, I am assuming that you are unemployed since you said you were living off the credit card, so it would appear on the surface that bankruptcy would be a good option for you. Have you charged anything besides food, clothes, gas, the necessities of life in the last 90 days? If so, you may want to wait 90 days from your last charge are the credit card company can come after you and make you pay them for any unnecessary charges that have taken place in that 90 days.

Answer Applies to: Michigan
Replied: 11/17/2011

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Bankruptcy is probably your only option. If you can't afford their settlement demands, they can take whatever steps the law allows to collect the debt. This could include wage garnishment, bank account seizure, and seizure of other assets.

Answer Applies to: Minnesota
Replied: 11/17/2011

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Depending on the total amount of debt that you have and the extent of assets that you won which are not exempt, bankruptcy may well be a good option, BUT you need to sit down with a lawyer for a free consultation and discuss your specific situation. To not file until you have conferred with a lawyer.

Answer Applies to: California
Replied: 11/17/2011

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Chapter 7 Bankruptcy will discharge all of your credit card debt without having to pay anything back. Also, if you settle the debt you are responsible for the 1099 you will receive from the bank as if it was income. For example, if you owe $15,000 and settle for $10,000, you will receive a 1099 from the bank for $5,000. In bankruptcy, you will have no 1099's from the bank.

Answer Applies to: New York
Replied: 11/17/2011

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Bankruptcy is always an option for consumers - whether it's a "good" option or not depends on your personal financial situation.

Answer Applies to: Texas
Replied: 11/17/2011

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If you have been served with a lawsuit, you either need to file an Answer deny the allegations or file a bankruptcy petition. If you do neither of these actions, the debt collector will obtain a judgment against you. Trying to negotiate with a debt collection law firm is akin to banging your head against a wall. You need to talk with an attorney about your options. If you don't want to file bankruptcy, an attorney can help you settle the debt for less than you can by yourself.

Answer Applies to: Texas
Replied: 11/17/2011

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Bankruptcy eliminates debt and debt settlement involves offering to pay less than the balance owed in cash(usually your starting offer is 25% cash) You have little time to act. Do not let the creditor obtain a judgement on the lawsuit because that gives them the power to garnish wages & bank accounts, as well as place liens on your real estate. If you do not have the ability to settle for cash, contact a bankruptcy attorney immediately.

Answer Applies to: Colorado
Replied: 11/17/2011

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Yes. However, keep in mind that all your credit card accounts will be closed and you will need to apply for new ones after bankruptcy. And you should be careful with credit cards after bankruptcy, as you won't be able to discharge them through bankruptcy again any time soon.

Answer Applies to: Florida
Replied: 11/17/2011

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If you qualify, bankruptcy is a great option. Chapter 7, also known as liquidation bankruptcy, will give you the fresh start you need.

Answer Applies to: California
Replied: 11/17/2011

Disclaimer: The response above does not form an attorney-client relationship. This answer may or may not apply to you and should not be relied upon as legal advice. LawQA does not make any representation as to the expertise or qualifications of this attorney. This attorney may or may not be admitted to state bar of your state.