In 2025, nearly 550,000 individuals filed for Bankruptcy protection. The American middle class is waking up to the fact that they, too, are entitled to Bankruptcy Protection, just as General Motors and Chrysler are. The greatest entrepreneurs in history have used Bankruptcy to restructure debt, free up capital, and improve their businesses. Other millionaires who have filed for Bankruptcy protection? Henry Heinz (ketchup magnate), Milton Hershey (chocolate magnate), Charles Goodyear (rubber magnate), and countless others. If you’re considering bankruptcy, please continue reading and reach out to a seasoned Rockland County consumer bankruptcy lawyer from Law Offices of Allen A. Kolber, Esq. today.
Do Middle-Class Families File for Bankruptcy?
Most of my Bankruptcy clients are middle-class families with both spouses working; they own a home or condo, one or both spouses have a college or Master’s Degree; they have paid for their children’s college educations, or are currently paying their children’s student loans since their children cannot find jobs after graduating college. In fact, in 2025, 549,577 non-business bankruptcy cases were filed in the United States, according to the Administrative Office of the U.S. Courts.
What Causes People to File for Bankruptcy?
The typical Bankruptcy filer in America is a middle-class head of household with children and a full-time job; better educated than the general population; most suffered a personal event such as loss of employment, divorce or medical issues; homeowners who were defrauded into obtaining first and second subprime mortgages, seniors on a limited income with extraordinary medical expenses or unemployed or underemployed college graduates with student debt reaching $100,000.
The American middle class was hit the hardest by the recent financial crunch. A middle-class family that is hit by a loss of a job, divorce, or illness tips straight into debt.
Is It Immoral to File for Bankruptcy?
There are no moral or ethical issues in filing a Bankruptcy case, just as there were no moral or ethical issues contained in the contract you entered into with your credit card company or mortgage lender.
What Rights Do Creditors Have When You Owe Money?
Both Federal & State laws allow credit card companies and mortgage lenders to adjust their interest rates, charge you late fees, over-the-limit fees, and other penalties. If you are late in making a payment, US law allows your creditor to use a collection agency to collect its money, or sue you in court. If the creditor obtains a judgment against you, the law allows the creditor to freeze your bank account, garnish your wages, repossess your car or sell your home in foreclosure.
What Can Bankruptcy Help Stop?
The Federal government also enacted the U.S. Bankruptcy Code, which allows all eligible debtors (GM, the President, or you) to eliminate or restructure their debt, stop lawsuits, wage garnishments, bank restraints, foreclosures or repossessions.
What Property Can Bankruptcy Protect?
The same U.S. Bankruptcy Code protects most tax-qualified retirement accounts, such as 401(k) and 403(b) plans, in full, and protects up to $1,711,975 in IRA and Roth IRA funds.
What Are the New York Bankruptcy Exemptions?
New York filers must choose either the New York exemptions or the federal exemptions — the two sets cannot be combined. Under the New York exemptions, you can protect up to $204,825 of home equity per owner in Rockland, Westchester, Putnam, Nassau, Suffolk and the five boroughs ($170,700 or $102,400 in other counties), $5,500 of equity in one motor vehicle per filer, and — if you do not claim the homestead exemption — $6,825 in cash plus a $1,325 wildcard. Married couples who file jointly and co-own the property can double these amounts. New York’s figures apply to cases filed through March 31, 2027; the federal figures apply through March 31, 2028.
In fact, the courts have long described this discharge as giving honest debtors a “Fresh Start.”
Can Bankruptcy Provide a Fresh Financial Start?
For most of my clients, filing Bankruptcy is the most responsible step they have taken to regain financial stability for their family.
If you believe that Bankruptcy may be in your future, you should consult with an experienced attorney. The Law Offices of Allen A. Kolber, Esq. has over 35 years of experience helping clients through tough times. Our compassionate attorneys are here to guide you through your best options on the road to financial recovery. It is important that you retain the services of an effective attorney, and our firm is ready to serve. Contact our firm.
Generally, individuals have two options for bankruptcy: Chapter 7 and Chapter 13 bankruptcy. The Law Offices of Allen A. Kolber, Esq. can help you make informed decisions that can help you become financially stable once again.
Filing for Bankruptcy protection should not be viewed as something dishonorable. Circumstances in life or business can sometimes place even responsible individuals and families in serious financial situations. Recognizing that people may need assistance returning to a position of financial stability, the Government created the opportunity for a “Fresh Start.”
A Chapter 13 Bankruptcy may be an option for families who have assets, equity in their home, or income that exceeds the average family income in their county. Through Chapter 13 Bankruptcy, debtors can remain in possession of their assets while receiving the protection of the Bankruptcy Court. In return for keeping those assets, a Chapter 13 Debtor must propose a repayment “Plan” lasting either 3 or 5 years.
Except in an emergency involving an imminent Foreclosure sale, warrant of eviction, or bank restraint affecting a substantial amount of money, no one should rush into filing a Bankruptcy case. Every client should carefully consider the decision and seek guidance from both an accountant and an experienced Bankruptcy attorney.
One of the most powerful protections available during the Bankruptcy process is the Automatic Stay. It generally takes effect as soon as the Bankruptcy case is filed, giving the debtor room to breathe while reviewing the available options for debt relief. However, the Automatic Stay has limitations. It may be shortened or unavailable when a prior Bankruptcy case was dismissed within the preceding year, and it may not stop an eviction if the landlord has already obtained a judgment of possession.
Download our Bankruptcy Checklist & Information Packet.
Contact a Consumer Bankruptcy Lawyer in Rockland County, New York
If you’re facing bankruptcy, you need a knowledgeable and skilled consumer bankruptcy lawyer in your corner who can work to ensure your rights and interests are protected, every step of the way. Contact a consumer bankruptcy lawyer from the Law Offices of Allen A. Kolber, Esq. today. We proudly serve clients throughout Rockland County, including in Suffern, Nanuet, Stony Point, Haverstraw, Ramapo, New City, Orangetown, Clarkstown, Nyack, Pearl River, Orangeburg, West Haverstraw, Theills, Airmont, Pomona, Spring Valley, and Montebello.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code. This page is attorney advertising and is for general information only; it is not legal advice and does not create an attorney-client relationship.
