People often ask if their high amount of debt will disqualify them from filing for bankruptcy. The total amount of debt you have is important depending on which type of bankruptcy you intend to file.
For a Chapter 7 bankruptcy, there are no limits to the amount of debt you have. It can be $100 or $1,000 or $1,000,000 worth of debt.
For a Chapter 13 bankruptcy, there are limits to the amount of debt you can have. The limits for a Chapter 13 bankruptcy are $360,475 for unsecured debt (credit cards, medical bills, personal loans, etc) and $1,081,400 for secured debt (debt with collateral-usually mortgages, vehicles).
There is no minimum debt requirement for filing either a Chapter 7 or Chapter 13 bankruptcy. You can file with any amount of debt. It all depends on your current financial situation and your ability to pay your creditors. Sometimes creditors push people into bankruptcy by wage garnishments, levies and liens. No two bankruptcies are the same and you should ask yourself "Can I realistically pay off all my debts?"
If you are considering bankruptcy, contact an Orange County Bankruptcy Lawyer at 1st California Law for a free consultation.