By Ryan C. Wood
Happy new year my fellow human beings. The only regret I hear from clients is not filing for bankruptcy protection sooner. That’s it. I get no phone calls from past clients complaining about filing for bankruptcy. If so, I would have no time to talk to potential clients or do any work. A natural law truth about bankruptcy and how you know it is a good thing. Try and find complainers on Tik Tok or YouTube.
Why Do You Believe Bankruptcy is Bad?
Well, you are a human being and other human beings tell you things whether those things are true of not. It is no different than racism. You were told bankruptcy is bad and you believe it ignorantly. You know nothing about filing bankruptcy or how your fellow human chose bankruptcy yet judgment based upon this one thing. Sounds a lot like judgment someone based upon their skin color or gender. Come on people.
But yes, if you have not been paid and the company or person that owes you money filed for bankruptcy and discharged what was owed you, you can feel that personal financial blow and I get that. I, as a small business owner, as a bankruptcy attorney, do not always get paid what I have earned or the benefit conferred. It is part of owning and running a business. There are costs of doing business.
The vast majority of debts discharged and not paid back in a typical Chapter 7 or Chapter 13 bankruptcy case are owed to large multi-national corporations there were deemed too big to fail when they messed up. These massive corporations are not losing money year after year and generally make billions of dollars each quarter regardless of bankruptcy filings. The credit accounts discharged generally have interest rates above 20%.
Let Us Do Some Math: Do Credit Card Companies Ever Lose Money When Someone Discharges the Debt When Filing Bankruptcy?
So, my fellow humans, let us set some ground rules.
- The debt owed is $15,000.00
- Interest Rate: 18%
- Human continued to use the card, incur more debt, as making payment for 6 years, so the balance stayed at $15,000.00 as payments are being made for the 6 years
Okay, so these are the ground rules. A hypothetical human making payments for years and using credit and suffering to make the payments each month for the 6 years causing stress and anxiety.
What is the total interest paid? $16,200.00
The monthly payment would be approximately $350.00 a month. 72 months or six years multiplied by $350 = $25,200.00
This is NOT precise math, but it provides the true representation of how much your follow human actually pays before filing for bankruptcy protection and discharging the debt.
What do large multi-national corporations lose then? They lose more profit when they are already making huge profits each quarter or every three months.
According to Zachs Earning Trends, below are the last quarter profits as of December 2025.
Wells Fargo Bank, N,A.: $5.36 billion
JP Morgan Chase Bank, N.A.: $13.03 billion
Bank of America, N.A.: $7.6 billion
Citigroup: $2.5 billion
They are doing just fine.
When Do I hear Back From Clients?
As a bankruptcy attorney the only time I generally hear back from clients is when they need their bankruptcy documents because they are buying a house. That is right. Buying a house. That’s it.
Are you surprised? You probably are surprised because of the media and “they” would have you believe bankruptcy is so bad and will ruin your credit. No, a myth or old news about filing bankruptcy. Prior to 1978 that was more true as credit was hard to get. The Supreme Court of the United States held a bank headquartered in one state can export the interest rates of that state and not be limited by the state’s interest rate laws their customer lives in. So various states did away with their usury laws limiting interest rates on revolving credit accounts like credit cards.
The point is today there are all kinds of ways to get credit and loans. There are endless online sources of short-term high interest loans. Pay day loans are easy to obtain too with sky high interest rates. But money and credit are more available today than ever before. So, no, you will not be driven into the ground never to have credit again.
So What Are The Problems With Bankruptcy?
Generally, the issues with the bankruptcy process are about the professionals and parties involved in bankruptcy cases and how they interpret the law and procedure. Luckily, here in the Northern District of California, and the Eastern District of California too, the interpretation of the Bankruptcy Code is generally good. Other states and jurisdictions not so much. Like the Central District of California is ripe with fraud from chapter 7 trustee’s stealing the assets of debtors by over billing. The Office of the United State Trustee and its attorneys call themselves the watch dogs over the bankruptcy process. The Office of the United States Trustee does nothing to curb the fraud under its wing and approve the fees. What that means is the Office of the United States trustee will bring up issues regarding the debtor and the debtors attorney only. The Office of the United States Truste do not apply the same scrutiny to creditors, their attorneys, or Chapter 7 trustee or Chapter 11 trustee’s they hire. There is a double standard sad to say. It would be nice if the Office of the United States Trustee curbed vexation creditors and their attorneys to not abuse debtors when filing for bankruptcy. According to the American Journal of Epidemiology there is a 20-fold higher risk of attempting suicide than individuals who have experienced no financial strain.
Why do bankruptcy filers commit suicide if bankruptcy is relief? Certain humans do not care and administer bankruptcy cases NOT providing relief to debtors and they kill themselves feeling like there is no hope. No, that is the real world and not how the bankruptcy world should ever make anyone feel there is no hope. That is the point of filing for bankruptcy relief. Well, bankruptcy can only do so much to solve the mental anguish and feeling there is relief in sight. That can be largely due to treatment in bankruptcy by creditors and the Court. The Bankruptcy Code is for bankruptcy filers falling on their shield and seeking the relief the Bankruptcy Code provides. Most filers are honest and unfortunate debtors that have suffered enough. And that is the measure for you to think about. How much do you want your fellow human to suffer trying to pay back their debt? How long is enough?
Stop Judging Your Fellow Human Based Upon One Thing
The single most troubling thing I see with my fellow human being is application of their belief system. Everyone talks about equality. Equal treatment. Are you equally applying your belief system consistently as to all issues? No, if so, there would be no negative stigma with filing for bankruptcy. No one would be judging their fellow human negatively. Do not take the color of skin, do not take gender, do not take hair color, do not take bankruptcy the one thing to discriminate or treat your fellow human differently. Bankruptcy is no different yet there is stigma. Human, you are failing. Stop judging your fellow human based upon one thing and apply that to all of your life.
When Will Humans NOT Be Hypocrites – President of the United States of America
It starts at the top right? A human cannot be elected President of the United States of America without believing in God. Yet the moment a president takes office they start murdering people overseas in the name of freedom or some other justifiable cause. Yet their religion, that they believe on, says thou shalt not kill. Balance that. How about a president of the United States of America that stand up and says no, no more. It was wrong then and it is wrong now. We will set the example for Earth and never ever kill another human being for any reason as religion demands. It is not supposed to be a question. It is black and white, a one or a zero in the digital world. An absolute. Can you imagine not spending trillions of dollars each year on weapons and our tax dollars actually benefiting us taxpayers? Seems to good to be true, but that is what is being preached. It is not what is actually happening though. We have a very short amount of time on planet Earth.
Why do you continue to accept the suck?
