This year, hundreds of thousands of Americans are expected to be too broke to file for bankruptcy, CNNMoney reports.

The average cost to file for Chapter 7 bankruptcy protection, the most common form of consumer bankruptcy, is more than $1,500, according to recent research submitted to the National Bureau of Economic Research.

As a result, anywhere between 200,000 and one million consumers are estimated to be unable to afford to file bankruptcy this year, when it may be their only option for debt relief and a truly fresh start. The research, conducted by a group of professors from Columbia University, the University of Chicago and Washington University in St. Louis, examined how bankruptcy filings spiked after people received their tax rebates in previous years. They estimate that another 200,000 consumers, who would otherwise not have enough money to file, will use their tax refunds to pay for bankruptcy this year.

As a result, for lots of people, bankruptcy has been taken off the table as an option because of the severe fees involved. Among those fees is a charge of about $300 just for filing the paperwork with the federal court. And there are other expenses on top of that, including fees for mandatory pre-bankruptcy credit counseling and a pre-discharge debtor education course. These average about $85 altogether, according to a recent study sponsored by the American Bankruptcy Institute. That means many of the Americans who have seen their debt snowball out of control due to events like job loss, divorce, foreclosure or a medical emergency during the economic downturn are now left without their last financial lifeline. Having an attorney that understands the difficult position their prospective clients might be in is therefore critical to a successful and stress-free fresh start.

As most people who are in financial distress understand, it becomes harder and harder to pay off the debt as interest payments get higher, so your debt grows larger and larger. The cost of filing for bankruptcy has risen in recent years as a result of the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act, which aimed to reduce the number of bankruptcies taking place by adding more requirements to the filing process — including additional paperwork and the credit counseling and debtor education.

While the bankruptcy rate has fallen slightly since the law took effect — from a rate of 1.4% in 2004 to 1.3% last year — the average income of bankruptcy filers has increased, the NBER study found. The findings indicate that the new requirements are pricing out many of the consumers who are least able to afford the fees, said Wang. It ends up being the relatively better off, or middle-class consumers who can actually afford to file, and the people with lower incomes can’t afford to file. This defeats the purpose of bankruptcy relief, and prevents those who need the help from actually getting it.

It’s not that attorneys are greedy or selfish, but more a matter of changes in the law that require the attorneys and their staff to do more paperwork, and engage in a more complicated filing process. As a result, since changes in the law it can take an attorney about twice the amount of time it previously required to file a bankruptcy petition.

While most attorneys and firms do not offer flexible payment options, Jassim & Associates does. We can offer creative payment options that will not cause you further stress, and will get you the help you need. Given the financial realities that those who need to file a bankruptcy face, we understand that in order to help our clients, we have to assist in facilitating bankruptcy relief – instead of being yet another obstacle to a fresh start.

Think twice before you decide to go it alone. Filing on your own is not an easy process. If you make a mistake and your case is dismissed a dismissed bankruptcy hurts your credit just as badly as one you complete. So you have all the downside without the benefit of a fresh start.

If you are considering filing for bankruptcy, you should also be warned against low-cost document preparation services claiming to help consumers fill out necessary documents. It’s easy for consumers to think they’re getting sound legal advice even though the preparers aren’t lawyers. Our firm not only advises on whether or what type of bankruptcy is appropriate, we handle your creditors and will guide you through the process as your attorneys, each step of the way. We can stop the harassing bills and creditor calls, and help free your mind from the stress and worry that some nasty creditors pride themselves on. We are also experienced in opposing any challenges or objections a creditor may have to your bankruptcy, whereas a document preparation service may abandon you in the middle of the process.

If you have bills and debts that you are struggling to pay, or if you find that most of your income is going to service debts that you are unlikely to ever be able to repay while little if anything is left for you or your family to live on, give us a call for a free consultation with an attorney who can answer all your questions and help you decide your best and quickest way to a fresh, debt free future!