Many people opt to file for Chapter 7 bankruptcy without assistance from an attorney. Sometimes it is because they feel their cases are simple and straightforward, while in other instances they feel that they can’t afford the attorney fees. While you certainly have the legal right to file for Chapter 7 on your own, help from a bankruptcy attorney could result in you keeping more assets and discharging more of your debts.
Below are four potential risks of filing for bankruptcy on your own.
It is easy to make mistakes on the paperwork
When you file, you will need to prepare a bankruptcy petition and a series of supporting documents that itemize your assets, debts, and creditors in specific detail. If you make any mistakes while compiling these documents, your case could be delayed and even dismissed altogether. A bankruptcy attorney will confirm that all relevant paperwork is correct before it is submitted to the court.
Dealing with creditors can be difficult
If one of your creditors decides to cause problems or lift the automatic stay, you might not know how to handle their objections in a way that preserves your bankruptcy protection. A bankruptcy attorney has the training, experience, and knowledge of applicable law to address creditor challenges without harming your case.
You might choose the wrong exemptions
With a Chapter 7 filing, you risk having assets seized by a trustee, who will sell them and distribute the proceeds to your creditors. In New York, you can choose to use state or federal exemptions to protect as much of your property as possible. Making the wrong choice for your particular situation could result in losses that might have been prevented if you had legal advice.
Chapter 7 might not be right for your financial situation
While Chapter 7 has given millions of Americans the debt relief they desperately needed, it might not be the right choice for you. Chapter 7 is intended for those with few assets and a comparatively low income, and it may not help you deal effectively with an imminent foreclosure. If your income is higher or you want to protect your home from being seized by the bank, Chapter 13 or even a non-bankruptcy option like debt consolidation or mortgage modification might be a better choice.
While you may hope to save money by representing yourself in your Chapter 7 filing, doing so could cost you more in the long run. Speaking with a New York bankruptcy attorney is well worth the time- you may learn that filing for Chapter 7 is more affordable than you thought, and your chances of eliminating your debts while keeping important assets are greatly improved. To learn more about Jayson Lutzky, P.C., visit www.MyNewYorkCityLawyer.com. Jayson Lutzky is a Bronx attorney who represents clients in personal bankruptcy cases. If you are considering filing for bankruptcy protection, then call 718-329-9500 to set up an in-person consultation for free legal advice.