Bankruptcy: Don’t File Without an Attorney!

Published 04/08/16 by Admin

As a practicing bankruptcy attorney, I have noticed a growing trend at the 341 hearings (initial bankruptcy hearings): Debtors filing without an attorney (also known as filing pro se). I have practiced various areas of the law over the years, but I have told people time and again that there is one area of law that I would not handle pro se: bankruptcy.

There are various reasons that someone should consult with an attorney to file their bankruptcy. Even though a debtor’s funds may be limited, it is extremely risky to go through this process without an attorney well versed in the law and the proceedings to follow.

First, an attorney will ensure that your assets are protected. The bankruptcy code provides specific provisions that can help protect your assets from the Trustee. However, I have been to many bankruptcy hearings when a pro se debtor did not correctly protect their assets with the available bankruptcy provisions. The trustee will then give the debtor two options: 1. Amend your paperwork to address the problem or 2. Require that the debtor turns over said assets. Neither option is desirable.

Second, an attorney can prevent the need to ever amend your bankruptcy documents. It is not a simple process to amend bankruptcy documents. The trustee will not explain how the documents need to be amended but only that you need to amend them. Depending on the amendments requested, there could be a significant amount of work. If you seek an attorney at this point, he or she may charge you more than his/her basic bankruptcy retainer. They charge more because they will need to review your documents then re-enter and refile a large part of your case. It is often more difficult than filing the case from the beginning.

Third, a debtor should retain an attorney to file their bankruptcy because it will significantly reduce any chance of the case being dismissed. The trustee could dismiss your case for various reasons: you do not show up on time, you did not provide the trustee with the requisite paperwork, or you simply do not fill out the forms correctly. If the case is dismissed, the court will not refund your filing fee (currently $335.00). The court may also order that you cannot refile a bankruptcy for a set amount of time. If the court delays your refilling, the creditors will be able to come after you aggressively during that period. I have not had a basic Chapter 7 case dismissed in many years. Since I know what the trustee and the court requires, I can guarantee that the court will not dismiss my client’s bankruptcy filing.

Lastly, a good bankruptcy attorney will make sure that all of the debt is correctly listed on your bankruptcy. People choose to file bankruptcy to be relieved of a significant amount of debt. Unfortunately, individuals who file bankruptcy without an attorney may receive their bankruptcy discharge only to continue to have problems with creditors. A good bankruptcy attorney will utilize all available means to list your creditors completely on the bankruptcy. It is important that the creditors are accurately listed on your bankruptcy to ensure that they receive notice of your filing. The attorney could also help you address creditors who continue to harass you after the bankruptcy filing or even after the discharge.

While family and friends in the community may tell you that the bankruptcy process is easy and/or straightforward, it was only likely so because they had an attorney that fully prepared them for the bankruptcy process. Please take my advice seriously so that you do not end up with the same problems that most pro se filers face in the bankruptcy court.