Bankruptcy Preparers

I recently joined an online forum dedicated to answering questions about bankruptcy.  One of the more common questions is along the lines of "Can I do a bankruptcy myself?"  Underlying this question is the concern that a person already strapped for money is being asked to pay $1,000 - $3,000 or more to have a lawyer handle the bankruptcy.  What clients often see is only the finished product, a stack of papers about 1/2" thick, that constitutes their petition and supporting schedules.  How hard can it be to fill out some papers, they ask?

Some want to go even farther and get someone, called a bankruptcy preparer, to fill out the papers for them.  Bankruptcy preparers are expressly permitted by the Bankruptcy Code, but there are a number of things preparers can't do, if they're following the rules.  First, they can't give legal advice.  In other words, they can't tell you what to put down.  They can only put down what you tell them.  Secondly, they can't go with you to court.  You're on your own there.  Third, once they finish preparing your schedules, they are done.  They have no further interest in you or your case because they can't have an interest.  All they can do is fill out paperwork.

Bankruptcy is one of the most complicated legal processes there are.  It is far more complex than a divorce, a will, a DUI or most litigation.  The 2005 Bankruptcy "Reform" Act made it even more complex.  If you don't know what you are doing, you can fail to claim exemptions you're entitled to, meaning you can lose property you are able to keep; you can incorrectly fill out the Means Test, meaning you might think you don't qualify for Chapter 7 when you really do; you can fail to respond to a motion, resulting in something bad happening, such as having your discharge denied; and you can even be guilty of bankruptcy fraud, meaning you can lose your right to a discharge and even go to prison.

Think of it this way.  You're trying to get rid of maybe hundreds of thousands of dollars of debt and gain a chance at starting your life over, a chance that comes along only once every eight years at best.  Isn't it worth $2,000 to get it done right?