Just One More Time For the Record: Think Four Times!

14 Apr Just One More Time For the Record: Think Four Times!

In Rachel Foley’s recent posting here, she urges readers to think once, twice, three times about trying to represent yourself in bankruptcy. About a month ago, I posted on a “painful to watch” 341 hearing with two debtors who tried to use a bankruptcy petition preparer and save money. Each had bigger issues with missing assets and odd papers filed. Now….read the rest of the story!

For example, in my last posting, I talked about the two debtors: one came to see me after the hearing. The debtor who ended up hiring me was not pleased to learn that his second mortgage refinance to pay off his car created an issue with too much equity in his car. So, now he has to pay money to the unsecured creditors to keep his car. He quite simply can’t afford even $100 a month as all overtime at his work has stopped. He has a second mortgage after having had two personal unsecured loans, and was talked into getting a third loan by the same company as a second mortgage–now he was going to be paying for his car for 15 years!!!

At the last minute before filing his amended paperwork, I requested a market analysis on the residence. Lo and BEHOLD!!! Rather than being worth more than the two mortgages combined, the older manufactured home with roof, electrical, flooring, and foundation issues is worth less than the first mortgage. What a pleasure it was to tell this debtor that I think we can persuade the judge to strip the second mortgage off and treat it as unsecured debt. The debtor was astounded and unbelievably happy to learn that this kind of treatment of a mortgage was possible. And he would never have been able to do this with a bankruptcy petition preparer. Just another reason to think ONCE, think TWICE, think THREE times, and then think FOUR times….before choosing to not have an attorney.

Besides the stress of going through a 341 hearing and having the US Trustee be there to ask questions about how the legal determinations were made (a preparer cannot give legal advice), there is also the benefit of having an attorney look at the assets, look at the debts, and analyze what help/steps can be taken to make the situation as good as possible for the debtor.

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I'm a consumer protection lawyer in Oregon, working with people in Klamath; Lake; Jackson; Josephine; Curry; and Deschutes County. I speak regularly on bankruptcy and consumer protection issues nationwide.
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