How much debt should I have before considering filing for bankruptcy?
There is no minimum debt necessary to file for bankruptcy protection. The choice to file is often a matter of debt versus income. If, after reviewing your finances, you do not believe you can pay the debt back within 4 to 5 years, then bankruptcy is an option to consider. The reason we use 4-5 years as a guideline, is that is roughly the amount of time you would spend paying on a Chapter 13 repayment plan. Chapter 7 would let you wipe most debt away and a Chapter 13, lets you restructure the debt and often allows payment based on your monthly disposable income.
Determining whether to file is very fact specific so you are best consulting with a bankruptcy attorney to determine if bankruptcy is a fit for you.
Bankruptcy is a legal and financial decision; it is not an ethical or moral one. Congress included bankruptcy as an option for relief from debt. Bankruptcy as a concept has been around for thousands of years, and it is not the fatal blow to your credit (or character) that people seem to believe. In fact, in most cases in a short time after the bankruptcy discharge, your credit score will move well above what you may have had when you filed for bankruptcy.