Bankruptcy, How Can I Afford To File?

by Rachel Lynn Foley, Esq.

January 31, 2007

The real cost of filing your own bankruptcy.

The real cost of filing your own bankruptcy.

Often the comment is made: “If I could afford your fees I would not be in the financial mess that I am in.” On average, attorney’s fees to file a Chapter 7 will be in the neighborhood of $2,000. Attorney’s fees vary by area and most certainly by attorney. People are always looking for ways to save money.  The quest to save money includes surfing the Internet to save money filing bankruptcy.  As a result, people may discover for $125 one can have their case drafted through a “petition preparer”.  You always have the right to choose this route and it is not uncommon to see these cases in court…

However, before you make a critical decision about your financial future and think an attorney is too expensive, ask yourself if you know the law and how it affects you?   Do you know whether the 10-year look back period will apply to your case? What about the insurance check you have not cashed, or the tax refund you have not received but applied for, etc… My question to you is how can you not afford to have an attorney on your side protecting your interest so you do not lose any assets unnecessarily? Ben Franklin once said, “An ounce of prevention is worth a pound of cure“. Meaning your attempt to save money may now have the attorney’s fees doubled because it takes twice as much work to protect you or correct the mistakes. This is assuming an attorney will even take your case if you filed it on your own.

Many attorneys will not touch a bankruptcy case when it begins as a pro se case because the interpretation of the bankruptcy code is in a constant state of flux.  If bankruptcy code was cut and dried there would be no case law to decide, no arguments to be made by the creditor and the debtor could file their case by themselves. However, many bankruptcy issues remain undecided throughout the United States pertaining to the law.  For example the issue of credit counseling as to whether you can take it the same day as the filing or must is be the day before? This answer alone can make the difference between succeeding in your bankruptcy or having your case dismissed. Depending on your district this question may not have been decided yet.  Even if it has been decided in your district has the question been finalized in the United States Supreme Court.  Even with the guidance of the Justices from the United States Supreme Court, the interpretation of what has been issued as “law” is not absolute.  So if two attorneys cannot agree on what is written by the Supreme Court, which should be cut and dry, why would one even attempt to file a case on their own without training or experience?

There are options for those who cannot pay for a private attorney.  If you are in the State of Missouri and believe you truly cannot afford a bankruptcy attorney, you may seek help from the Missouri Voluntary Attorney Project at (816) 474-6750 or Missouri VAP. For other states you can request assistance through local Pro Bono Programs. These folks maybe able to help you file your bankruptcy for free. Even if you are attempting to save a house and need to file a Chapter 13, the pro bono services may be able to assist you. Call to verify the guidelines in your area.

By law I must disclose to any potential client they can represent themselves in the bankruptcy court or use a petition preparer who is not allowed to go to court with them per 527(b). Attorneys and judges continue to debate every day regarding the interpretation of the United States Bankruptcy Code actually means, this alone should be evidence that the law and the bankruptcy code are NOT as cut and dried as the creditors would want you to believe.

Knowledge is power and the more knowledge you have about the pitfalls of representing yourself, the more power you will have to prevent a costly mistake.

Seek the advice of a qualified bankruptcy attorney in your area and take control of your financial destiny.

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Former Bankruptcy Attorney to the Kansas City UAW: Ford and GM workers, now assisting the general public in Missouri and Kansas with regaining financial control using the Bankruptcy Code. 816-472-HELP (4357).

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Last modified: February 16, 2015