Chapter 7 bankruptcy gives you the opportunity to break out of that prison called your cell phone contract. Chapter 7 bankruptcy is the chance for you to get a fresh start. To maximize the benefits of this fresh start, you need to get rid of every debt and liability that you can.
A cell phone contract is often one of the most overlooked expenses that can really add up over time.
Do the Math
You would be amazed at how much money some people spend on a cell phone contract. I recently met with a couple from Rome, Georgia, who was spending more than $300 per month on their cell phones. $300 per month times twelve months per year = $3,600.00. In ten years, if they continue to spend the same amount, they would have spent $36,000.00!!!! I have actually seen some situations where the person’s monthly cell phone bill is more than their car payment.
Do you really need four cell phones on your account? Is unlimited cell phone internet really necessary for your 13 year old child? Do you really need internet on your cell phone? Do you really need to pay for voice mail? If you have not already done, check out Google Voice. It is free!
You Can Get Rid of It!
The most common objection I hear to getting out of cell phone prison by filing Chapter 7 bankruptcy is, “I just signed a new two year cell phone contract.”
“I can’t get out of the cell phone contract.”
My response is, s “Yes you can!”
If you are filing chapter 7 bankruptcy, you can list the cell phone provider in “Schedule G- Executory Contracts and Unexpired Leases.” Your cell phone contract is an executory contract. Apartment leases, car leases, and rent-to-own furniture deals are other examples of executory contracts.
In the statement of intention section of your Chapter 7 bankruptcy petition, you can specifically reject your cell phone contract. Once you reject it, you are no longer liable for any charges on the account (except for usage charges after your case is filed). If you want to ditch the cell phone contract, stop using it before your case is filed.
Show the monthly statement to your bankruptcy attorney
Make sure you give a copy of your cell phone bill to your bankruptcy attorney to make sure that your cell phone provider is properly notified of your Chapter 7 bankruptcy filing.
You should make the most of your fresh start and get rid of that awful cell phone contract.
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3. How much does it cost to file?