I get calls frequently from people whose income is well below the poverty level (in many cases is Social Security only) and think they need to file for bankruptcy, because somebody sued them.

Sure, in some cases they are right. However, you don’t want to file for Bankruptcy until you are through getting into trouble. If you are still incurring significant health care costs, if you are seriously underemployed (especially without health insurance), then, you may not be through getting into debt.

Any debt you incur after you file for Bankruptcy will not be included in your discharge. That means you will still have to pay it, and once you have filed a Bankruptcy, it will be at least several years before you can file another and get a discharge.

There are ways for very low income people to protect what they have even if they are sued. So, sometimes, I have to tell people that they are better off learning how to protect their assets from creditors and wait a while until they file.

Elaine