How to File Bankruptcy While on SSI & Disability

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It is possible to file for personal bankruptcy while on either Social Security Income (SSI) or disability payments. A Chapter 7 personal bankruptcy liquidates the assets of your estate to pay your creditors. A Chapter 13 bankruptcy requires that you have regular income in order to make regular plan payments to a Chapter 13 Trustee over a three to five year plan term. The Trustee then distributes your payments to your creditors to pay off your debts.

File a bankruptcy petition with the bankruptcy court in your jurisdiction. It helps to hire a bankruptcy attorney to help you file your petition with the bankruptcy court. An attorney can help you decide which Chapter of personal bankruptcy under the United States Bankruptcy Code you should file, as well as help formulate a bankruptcy strategy for your assets and creditor payments.

Create a budget with your attorney. While a Chapter 7 bankruptcy may be over within a few months and not require extensive long term financial planning, a Chapter 13 bankruptcy requires that a debtor make payments to a Chapter 13 Trustee over a three to five year time period. These payments are usually taken out of your bank account directly.

Complete your personal bankruptcy plan. Your ultimate goal while in bankruptcy is to reach an order of discharge from the bankruptcy court, which means that your case has reached a successful conclusion and all debts included in your bankruptcy plan have been discharged. If you receive SSI and/or disability payments, make sure they are deposited into your bank account in a timely manner so the bankruptcy court can take payments out of your account to pay your creditors.


About the Author

Jackie Lynn is an attorney by trade with a Juris Doctor and bachelor's degrees in law and business respectively. She specializes in bankruptcy and immigration law and is also is an avid fitness enthusiast and animal lover. She has been writing on her own hobby website since 2007.