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Top 10 Reasons You Should Not File Your Own Bankruptcy Case

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  1. You’re not a professional. Filing bankruptcy cases isn’t what you do for a living. But it’s something important that you need done, and considering the importance, doesn’t it make sense to rely on someone who is a bankruptcy expert?
  2. The forms are complicated. Who will you ask if you have a question about the proper way to fill out the forms, or exactly what the bankruptcy judge is looking for in a particular section? The basic information about your income and expenses must be handled correctly or the trustee will simply ask you do it over.
  3. How will you decide to file bankruptcy? One of the most significant things a bankruptcy lawyer can do is to look over your finances and offer some advice on whether you should go forward with bankruptcy or not. An experienced attorney has seen enough to be able to offer valuable advice. It’s possible you’ll meet with the attorney and not file bankruptcy.
  4. Who will you turn to at bankruptcy hearings? Let’s say you are in the creditor’s meeting and the bankruptcy trustee asks how you ended up in bankruptcy. You want to give an answer that’s true and is what the trustee wants to hear. If you relied on a bankruptcy attorney, he or she could be whispering to you now or taking over and answering that question.
  5. Do you know the bankruptcy rules? There are a number of rules laid out in federal bankruptcy law that help to govern individual and business bankruptcy proceedings. The problem is, you don’t know any of the rules or where to find them and may make a mess of the supporting documents that accompany your filing papers.
  6. Can you choose between Chapter 7 and Chapter 13? Do you understand the difference between the two individual bankruptcy choices? Are you comfortable that a brief time reading up on bankruptcy will arm you with enough knowledge? Or might you risk losing your home or car because you didn’t know when to choose Chapter 13 over Chapter 7?
  7. Can you handle the Means Test? Debtors who earn more than the median salary in the state can still qualify for Chapter 7 bankruptcy by filling out something called the Means Test. This is as confusing as it gets in bankruptcy law. Basically it’s a test to see if there is any discretionary income left each month after paying your expenses. But the income information you provide is not your current income. And the expenses are not your actual expenses. Seriously.
  8. Do you know how to claim exemptions? One of many crucial parts of the bankruptcy process is to establish the state or federal exemptions that protect your property. The goal is to find as many exemptions as possible. If you miss one, then you have to give up that property to the trustee.
  9. Can you put together a successful Chapter 13 plan? If Chapter 13 is the best way to go, because you need to protect property or a co-signor or other issue, do you know how to propose a budget and 5-year plan that will be accepted by the bankruptcy trustee?
  10. This really is close to life and death. For a debtor unable to meet all of his or her monthly financial obligations, bankruptcy may be the only answer. But if your lack of expertise causes the bankruptcy trustee to reject your bankruptcy filing, your situation reverts to where you were at the moment you filed for bankruptcy protection.
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