Have you ever wondered if bankruptcy might be a good option for you to regain your financial footing? Do you have questions about how bankruptcy works in Idaho? This information below guides you through some of the information you need to know in order to make an informed decision about whether bankruptcy is right for you. 

In addition to the attached Bankruptcy Basics guide, Idaho Legal Aid Services has created an Understanding Bankruptcy in Idaho video in both English and Spanish.

If you are low income and would like more information about bankruptcy, please contact your local Idaho Legal Aid office. 

If you need to file Chapter 7 bankruptcy, you may be able to file your bankruptcy through Upsolve. Upsolve is a national non-profit that helps people file for Chapter 7 bankruptcy at no cost. Read about whether Chapter 7 bankruptcy is right for you and visit Upsolve’s web site, upsolve.org, to see if you qualify.

The Federal Trade Commission has created guidance for consumers on whether debt relief or bankruptcy may be right for them. Debt got you down? You’re not alone. Consumer debt is at an all-time high. Whether your debt dilemma is the result of an illness, unemployment, or simply overspending, it can seem overwhelming. In your effort to get solvent, be on the alert for advertisements that offer seemingly quick fixes. While the ads pitch the promise of debt relief, they rarely say relief may be spelled b-a-n-k-r-u-p-t-c-y. And although bankruptcy is one option to deal with financial problems, it’s generally considered the option of last resort. The reason: its long-term negative impact on your creditworthiness. Bankruptcy information (both the date of your filing and the later date of discharge) stays on your credit report for 10 years, and can hinder your ability to get credit, a job, insurance, or even a place to live. 

For more information, please visit their website at: https://www.consumer.ftc.gov/articles/0084-debt-relief-or-bankruptcy

Corporations and partnerships must have an attorney to file a bankruptcy case. Individuals, however, may represent themselves in bankruptcy court. While individuals can file a bankruptcy case without an attorney or "pro se," it is extremely difficult to do it successfully. 

For more information, please visit this U.S. Courts guide on filing without an attorney.

Be forewarned, the following journey through Chapter 7 bankruptcy law is a bit technical, so if you are considering filing for Chapter 7 bankruptcy, consider consulting with a bankruptcy attorney first. For more information, visit the National Bankruptcy guide on how Chapter 7 bankruptcy works.

Chapter 11 allows for reorganization that usually involves a corporation or partnership. For more information, visit the U.S. Courts bankruptcy basis for Chapter 11 bankruptcy.

A common question is whether or not a debtor can keep a credit card after filing for bankruptcy protection and do I have to list the cards I want to keep. If you owe a balance at the time the bankruptcy petition is filed, you must list the debt. This applies regardless of the amount of the debt. If you are worried that you cannot live without a credit card there are a few options. A credit card with a zero balance does not need to be listed and can be used after you file the bankruptcy petition. If you have a card with a low balance, you should pay it off before filing for bankruptcy. However, be careful not to use balance transfers to pay off the card as the transaction could be undone by the trustee or challenged by the creditor if it is determined that the transfer was fraudulent.

NOLO has created an excellent overview of this information as well.

Student loans are difficult, but not impossible, to discharge in bankruptcy. To do so, you must show that payment of the debt “will impose an undue hardship on you and your dependents.” 

To learn more, visit the Student Loan Borrower Assistance website.

A garnishment is basically a legal collections tool where a creditor obtains a court order compelling an employer to withhold a portion of an employee’s wages. The amount that can be withheld is capped at 25%, however, the percentage may vary depending on the state issuing the garnishment and the type of debt. The cap applies to all creditors, meaning 25% is the most that can be withheld at any one time. Garnishments, however, are not limited to wages and can involve one time garnishment of bank accounts or personal property. Whether or not bank accounts, personal property or tax returns can be garnished will depend the individual state.

More information can be found by visiting NOLO's guide on garnishments and bankruptcy.

The National Consumer Law Center (NCLC) has created Consumer Advice for Dealing with Debt Collectors. Their webpage covers the following information: 

• Do Not Let Collectors Pressure You
• What Collectors Can Legally Do to Collect on a Debt
• Nine Ways to Stop Debt Collection Harassment
• Illegal Debt Collection Conduct 

This webpage also includes example Cease and Desist or Stop Contact Letters, Exempt Income Letters, Dispute Letter, and Verification Letter to debt collectors. 

Visit the links above or go to https://library.nclc.org/consumer-advice-dealing-debt-collectors%E2%80%94including-new-federal-rules for more information.

The National Association of Consumer Advocates has created a series of videos providing information to consumers who are being sued on a debt. You can access those videos here: https://www.consumeradvocates.org/for-consumers/debt-collection.

This guide offers information on how to prepare for your small claims trial as a defendant (the person being sued and responding to the suit). 

For more information on small claims cases or for fillable PDF forms you can use in your small claims case, please visit the Idaho Court Assistance Office's webpage here: https://courtselfhelp.idaho.gov/Forms/claims.

The How to Prepare for Your Small Claims Trial as a Plaintiff (the person suing someone else) guide attached provides information on how to get ready for your trial in court. 

For more information on small claims cases or to find the forms to start your small claims case, please visit the Idaho Court Assistance Office's webpage on small claims here: https://courtselfhelp.idaho.gov/Forms/claims.

The attached How to Serve Your Small Claims Papers by the Idaho Court Assistance Office provides information on how to serve the defendant (the person being sued) in a small claims case. 

For more information on small claims cases or for the forms to file a small claims case, please visit the Idaho Court Assistance Office's webpage regarding small claims here: https://courtselfhelp.idaho.gov/Forms/claims.

This video series answers some common questions that come up during the small claims process, such as: 

• What is service of process?
• How long do I have for service of process?
• What are exhibits?
• Do I need to do anything if I collect from the defendant?
• Will the appeal be just like my first hearing?

Interactive Forms: Interactive forms are free to low income people in Idaho with certain legal issues. Interactive forms allow a person to input information which automatically enters into the appropriate forms. Interactive forms are available on the Idaho Guide & File website. Click "Start Your Legal Process" to to generate forms you can use to e-file or print to file in person at your local courthouse. 

If you don’t have all of the required information, you can still use the interactive forms to fill in the information you do have. If you set up a free and confidential user name and password for the interactive forms, you can start your form, save your answers, and finish completing the interactive forms when you have the remaining needed information. Or, you can complete as much of the information as possible, take your forms to your local Court Assistance Office, and ask for assistance with filling in the remaining needed information. 

Fillable PDF Forms: These are also available if you prefer not use to the interactive forms process. You may find fillable PDF forms and instructions here: https://courtselfhelp.idaho.gov/Forms/claims. Please view the instructions for each form before filing out the forms.