Find a copy of Nolo's Personal Bankruptcy book for your buddy and take Amp's advise on counseling.
I am talking from personal experience. I fell for someone's line about being in debt and needing to file for bankruptcy. I let the person live in my house for free so that they could SAVE for bankruptcy. The person went on unemployment for six months and did not look for a job. When I finally caught on that the person was never going to do anything, the person moved on to bum off the step daughter and then on to the person's parents house.
There's more to this story than I am going to share but I know that YOU can't help this person.
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