Filing for Bankruptcy Without an Attorney - Pros and Cons
by, 10-17-2012 at 06:39 AM (4683 Views)
Making the decision to file bankruptcy is the first step. The second step is deciding whether or not to use an attorney in the process. There is no law that states you must do so. In fact, you can represent yourself in a court of law throughout this entire process. All of the documents you need to file are available through your local bankruptcy court. So, if all of this is available, why are so many people using lawyers to file their case?
It's a Very Good Idea
Though there are both pros and cons to doing so, most will find that using an attorney is simply a must especially if you do not have a lot of experience in this field. The court system encourages it, though it does not appoint a free attorney for you (as this is not a criminal case.) Ultimately, you have to make the decision to file or not to file based on the factors that matter the most to you.
The Pros of Working with an Attorney
There are some very good reasons to work with an attorney when filing for bankruptcy. Take into consideration the following reasons why you should not go without.
The attorney has extensive experience in the process. What's important about this is that the court system is very strict about every detail, from the way a set of documents is stapled to the time frame you must complete the process. This expertise comes in handy.
You get advice on what to do and what not to do during the process. Often, a lack of experience triggers a miscommunication or a lack of understanding of the process. If you want to protect your assets, learn how to do so, for example.
There's less time invested on your part. In other words, you do not have to spend time researching the process and ensuring you file each element properly.
The bankruptcy trustee is more likely to want evidence and will conduct a more thorough investigation to ensure you haven't mislead the courts during the process.
In some forms of bankruptcy, especially Chapter 13, it is much more difficult to file without an attorney. In other cases, such as when you need to negotiate catch-up's for mortgages or get rid of second mortgage loans, these professionals are almost always necessary.
In most situations, especially when the bankruptcy case is complicated by extensive loans you hope to keep, co-signers, foreclosures or back taxes, it is best to work with a professional who has ample experience in filing bankruptcy. However, finding the right professional is important. You also need to know that this decision is the right one for your needs.
The Cons of Working with an Attorney
The fact is, working with an attorney means that you will have to pay more. Though filing bankruptcy does require a court fee to be paid in advance of your service, attorney fees also need to be paid. There are a few other reasons to consider doing it yourself.
If you are filing a simple Chapter 7 bankruptcy with limited to no assets, filing on your own is possible. With a bit of research, you can do this rather easily overall.
Sometimes, attorneys can stretch the process out. You'll need to be paid in full prior to receiving the service. And, you have to wait until the attorney processes the paperwork and moves the case forward.
If your household income is below the state's median rate, filing on your own isn't a problem. If it is above this, though, this makes the case more challenging since you will not immediately pass the Means Test.
Though the cost is one of the main reasons individuals do not like to use attorneys, the advice and guidance they give is hard to get otherwise. There are fee-only services, too. This compromise allows you to pay for just form fill out and submission rather than any court representation. That can reduce your costs and yet allow you to remain in control of the proceedings. It may be an option for you. Making the right decision for your needs means taking a large, long look at your options.