Sometimes, you can’t financially handle what life throws at you. At these times, many people turn to credit cards and other unsecured loans with high interest rates.
The debt can spiral out of control if you aren’t extremely judicious about paying these loans back quickly. Your financial life can quickly fall apart if any other surprise pops up, such as job loss or a major medical expense.
In these cases, some people turn to bankruptcy to solve their debt problems. That’s where Upsolve comes in.
What’s Ahead:
What is Upsolve?
Upsolve is a 501(c)(3) legal aid nonprofit founded in 2016. They help low-income people file Chapter 7 bankruptcy at no cost.
Upsolve offers this service for free to low-income Americans by using technology and pro bono attorneys.
What is Chapter 7 bankruptcy?
Chapter 7 bankruptcy allows you to erase some types of debt completely, such as credit card debt and medical bills, if your bankruptcy is approved.
Filing for Chapter 7 bankruptcy will grant an automatic stay, which means bill collectors won’t be able to contact you about debts you owe. Chapter 7 bankruptcy is a relatively quick process that could take as little as a few months to complete. Once the process is completed, the applicable debts will be erased. However, some types of debt, such as student loans, child support, and debt related to DUIs, can’t typically be erased.
Unlike Chapter 13 bankruptcy, you won’t have to set up a three to five-year payment plan to pay off certain debts. Instead, the applicable debts will be completely wiped out. That said, you may have to give up expensive property you own depending on the circumstances surrounding your property and your case. You may be able to keep a car or your house if it falls under your state’s exemption limits, but if you have a lot of equity in either you may have to give them up.
How does Upsolve work?
Upsolve helps everyday people file bankruptcy without having to worry about the added cost of hiring a lawyer.
While Upsolve doesn’t charge any fees, you may have to pay bankruptcy related fees to file. These fees include court filing fees and fees for government required credit counseling courses. However, the Upsolve screening process will determine if you qualify for fee waivers.
Upsolve walks you through the process of filing for bankruptcy step by step.
Step 1: Enter your email address and answer a few questions
These questions include:
- What state do you live in?
- Do you agree to their terms?
- How many people live in your household?
- How much money do you take in each month?
- Have you filed a tax return with the IRS for 2017?
- Are you comfortable using a smartphone or computer?
- Are you married to a spouse who also wants to file for bankruptcy?
- Do you have over $10,000 in debt from credit cards, medical bills or judgments?
- Is the primary reason for filing erasing one of the following types of debt?
- Student loan debt
- Child support
- Spousal support
- Benefit overpayment
- Debt from a DUI
- Do you own any real estate or have any mortgages?
- Do you own any other item that you could sell for more than $10,000?
- Are you currently involved in a personal injury case or do you think you could bring one?
- Have you filed bankruptcy in the past 8 years?
Based on your answers to these questions, Upsolve will let you know if you’re a good fit to use their service. They’ll then ask for you to provide your full name and phone number.
Step 2: Fill out their questionnaire
Next, you’ll fill out their questionnaire which takes about 60 minutes. You’ll also have to upload relevant documentation that they ask for including your last two tax returns.
Step 3: Take a credit course
As part of the process, you’ll have to take a credit course that takes about 60 minutes. Then, Upsolve populates the bankruptcy forms you’ll need to file with the court. You review the forms for accuracy and file them with your court clerk’s office.
You’ll also have to take a second financial lesson which is required and takes about 60 minutes.
Step 4: What to expect video
Next, Upsolve shows you a video of what to expect at your 341 meeting with your bankruptcy trustee that occurs one month after you file for bankruptcy. The meeting only takes about five to 10 minutes.
This is an in person meeting you must attend.
Who is eligible for Upsolve?
To be eligible to work with Upsolve, you’ll need to be eligible to file Chapter 7 bankruptcy. Beyond that, you’ll need to answer the initial questionnaire, detailed above, to see if Upsolve is a good fit for your situation.
Upsolve heavily relies on technology to complete much of the bankruptcy process. If you have a hard time dealing with technology, Upsolve may not be the best option for you.
Who is Upsolve good for?
Upsolve is good for those that qualify for Chapter 7 bankruptcy and need help filling out the paperwork to do so. It’s important to note you shouldn’t file just because you qualify for Chapter 7 bankruptcy. Instead, you need to closely examine your situation.
Who isn’t Upsolve good for?
While Upsolve is an amazing service, they can’t help everyone. If you aren’t eligible to file Chapter 7 bankruptcy, they can’t help.
Additionally, Upsolve will let you know you aren’t eligible to work with them if your answers to their questionnaire, detailed above, don’t fit within Upsolve’s ability to help you.
Summary
Filing bankruptcy is a serious decision. Don’t simply file because it’s the easy way to get out of debt. If you can pay off, even some of your debt, seriously consider your options before filing for bankruptcy.
Chapter 7 bankruptcy will stay on your credit report for 10 years which could make buying a home or a car in the future a much more expensive endeavor.
While bankruptcy is necessary in some cases, it shouldn’t be viewed as a simple solution to a complex problem.
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