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Why filing your own bankruptcy is risky business

At one time it was relatively common for people to file for bankruptcy without an attorney. They would get copies of the required forms, fill them out by hand, and file their own bankruptcy petitions at the clerk’s office. Afterward, they would appear on their own at the meeting of creditors and, if they were filing Chapter 13, the repayment plan confirmation hearings.

These people usually represented themselves because they couldn’t afford an attorney or they felt that their cases were straightforward and legal counsel was an unnecessary expense. Even back then pro se filings were not advisable, but the bankruptcy schedules were straightforward. The only complicated part was determining the right exemptions in a Chapter 7 case, but a lot of people correctly figured these out. Chapter 13 was a more difficult undertaking, but if they asked the right questions of their bankruptcy trustee, they navigated most difficulties.

That was 25 to 30 years ago. Now indebted consumers have significantly more difficulty filing their own bankruptcy cases for reasons like those below.

  • The schedules have become longer and more complicated.
  • When people go online to find the information needed to complete the paperwork, they’re faced with a lot of resources that are neither up to date nor accurate. The result is inaccurate paperwork that will have to be redone and refiled.
  • Exemptions are there to protect as much personal property as possible, but many pro se filers don’t know how to apply the right exemptions and risk losing assets as a result.
  • Bankruptcy filers must take credit counseling courses from an approved provider before they file and a financial management course before being discharged. Unaware of these requirements, pro se filers don’t submit the necessary certificates of completion and risk having their cases dismissed.

One of the biggest obstacles for self-filers is when complicated problems arise that they lack the training or knowledge to handle on their own. If a creditor challenges their discharge or the bankruptcy trustee claims that the person has committed fraud, then they have no idea how to file a motion in an adversary action or, if they research the topic and get a general idea, their motions or responses are poorly presented. The result is an inadequate defense that can deny them the discharge that they have worked hard to receive.

Working with a New York bankruptcy attorney can prevent all of these problems. They can explain the advantages and drawbacks of Chapter 7 and Chapter 13, show you how to apply exemptions so you protect as much property as possible, and protect your best interests if you’re on the receiving end of an adverse motion or allegation. Legal representation during your bankruptcy can give you peace of mind that more than justifies the cost of attorney fees.

If you are considering filing bankruptcy to obtain a fresh financial start, then speak to attorney Jayson Lutzky. He offers free in person initial consultations in his Bronx, NY office. Call 718-329-9500 to schedule an appointment or visit MyNewYorkCityLawyer.com to learn more.

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