Do I need a chapter 7 bankruptcy attorney to do my bankruptcy or can I do it alone?
October 4, 2010 Leave a comment
I believe that you do need a chapter 7 bankruptcy attorney to file your bankruptcy for you. Bankruptcy filing is a difficult process and it impacts many areas of your life. Filing a bankruptcy is far too complicated to do alone and I believe that you would be much better off with an attorney to assist you for the following reasons:
1) Property– A chapter 7 bankruptcy attorney can help you list, exempt, and save your personal property and your real estate. He or she can determine if you transferred any property recently out of your estate or if any property was transferred to you recently. This makes a big difference for your case. You want to be aware of the fraudulent transfer laws and avoid losing any property in the bankruptcy. In California the trustees can look back four years to determine if they are going to reverse any property transfers (and possibly take your property from you). A chapter 7 bankruptcy attorney can help you to protect your property so it is not taken by the bankruptcy trustee.
2) 341 hearing– A chapter 7 bankruptcy attorney will accompany you to the 341 meeting of the creditors. The creditors rarely show up but the trustee always does. The attorney can prepare you in advance for the hearing and then deal with any issues that arise with the trustee. Also a chapter 7 bankruptcy attorney will invariably have attended many such hearings (if he or she has experience doing bankruptcies) and he or she will know what to expect there.
3) Software and electronic filing- Bankruptcy attorneys that do chapter 7s probably file the cases electronically which is a much easier way to file than the old “over the counter” way. The software that is used by a chapter 7 bankruptcy attorney to do this is far too expensive for you to buy just for you to do your bankruptcy. With the software a chapter 7 bankruptcy attorney can efficiently and correctly complete your case and file it with the court.
4) Deciding which set of exemptions to use- Deciding which set of exemptions to use in a chapter 7 case may require a bankruptcy attorney to analyze your situation. There are many issues relating to whether you should choose the “703” set of exemption with the “wild card” or the “704” set if you have a house with equity in it that you need to homestead. You must choose between the two and a chapter 7 bankruptcy attorney can advise you of the issues you face as you choose.
5) Download credit reports-Most bankruptcy filing software programs have the ability to download your credit reports into the bankruptcy case. It is a tremendous advantage to have credit reports from all three major credit reporting agencies directly put into your case so there are no mistakes. These credit reports will accurately reflect what these agencies say you owe and the reports will come complete with the dates that you made the various charges to your credit cards. These dates will tell the trustee when you were incurred your debts so there will be no mystery as to how old they are.
You can get these reports yourself and enter the information manually but it is a great advantage to have this direct and efficient system to do it for you. The chapter 7 bankruptcy attorney can then compare that information with your creditor’s bills to make sure that your creditor information is listed in your bankruptcy as accurately and completely as possible.
6) Assistance with the means test– The means test is very difficult to fill out by yourself. It was added to chapter 7 bankruptcies in 2005 to force debtors who earned too much income into a chapter 13. The rational behind the test was that if they had enough extra income then they had the “means” to pay their debts back.
A chapter 7 bankruptcy attorney will use the same bankruptcy filing software to help him or her complete your means test and an experienced bankruptcy attorney will undoubtably have worked on many means tests for a number of clients. After examining your situation the attorney can determine if you pass the test and he or she can look to see if there is anything you can do to pass in the future. Also the attorney can make sure that you get the full use of all of your deductions to the means test so you can pass.
6) Representation in court– If something goes wrong with your bankruptcy case or if you need to defend against a challenge to the dischargeability of a debt then you will need a chapter 7 bankruptcy attorney to represent you in court. Only an attorney can represent you in court and a chapter 7 bankruptcy attorney should be familiar enough with the issues to do so. Having an attorney on the case already is a big advantage if things do go wrong and you wind up before a judge.
7) Reaffirmation agreements– You may need to reaffirm your car debt in the bankruptcy if you want assurance that the creditor will not repossess it. In California, according to the Dumont case (decided in the 9th circuit), an auto finance company can repossess you car after a bankruptcy even if you are current on the payments. Many of my clients don’t like this uncertainty and they demand a reaffirmation agreement even if I advise against it.
I have often ended up before a judge in bankruptcy court with these cases and the judges seem to not like these reaffirmation agreements. If you have a chapter 7 bankruptcy attorney then you will have someone who can argue for your reaffirmation agreement in court and this gives you a better chance of getting it approved.
There are other reasons but these are some of the main reasons why you should use a chapter 7 bankruptcy attorney to file your bankruptcy case. They will facilitate and expedite the process and be by your side when you need them. If he or she is experienced then a chapter 7 bankruptcy attorney can be invaluable to you for filing your bankruptcy.
I have seen debtors with no chapter 7 bankruptcy attorney show up at 341 hearings. The often get continuances for not filling out their schedules and means test correctly. Some draw a representative from the U.S. Trustee’s office who also looks over their case and some even get their cases dismissed.
Don’t let this happen to you.
I am a bankruptcy lawyer in San Diego.
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