Do-It-Yourself Means Testing For Bankruptcy

14 Mar Do-It-Yourself Means Testing For Bankruptcy

I’m a big fan of Home Depot. I love the rows of lumber, the acres of tools and doo-dads. Honestly, it makes me feel macho just being there. It’s as if I could go out and build a home like Michael Landon in Little House on the Prairie.

I mean, just look at all the do-it-yourself books on home renovation and repair! Shelves and shelves of easy-to-read guides will tell you how to grout, spackle, tile, shingle and do all manner of electrical and plumbing jobs without the need for costly contractors. Majestic!

But my parents didn’t raise a fool. I know full well that I’d most likely construct a rickety shack that would blow down in a weak wind. In fact, I learned my lesson about a decade ago when I decided to strip the old paint off a closet door. Half a door and three days later, I gave up. The half-stripped door taunted me for years until I finally re-painted it in shame.

There’s a difference between a how-to book and knowing how to do something.

If you surf online for more than 5 minutes you can find a bunch of sites with do-it-yourself means testing. Take just a few short minutes and you’ll be able to see if you qualify for Chapter 7 bankruptcy. If you don’t qualify, you’ll learn how large your Chapter 13 bankruptcy Plan payment will be.

Sounds awesome, right? The problem is that these calculators don’t come with enough knowledge to help you fully understand all of the deductions and allowances that you can take. Some of the calculators aren’t up-to-date, and others are just flat out wrong.

In the past few months I’ve had countless consumers come through my doors waving the results of their DIY means testing calculators triumphantly, only to learn that they did not qualify for Chapter 7 bankruptcy at all. These people end up not only disappointed but also frustrated that wasted their time sitting behind a computer when they could have gotten some answers from me more quickly.

I’ve even taken the liberty of running my own clients through these calculators after manually doing a means test on their behalf. The results range from laughable to absurd, though once the DIY folks came fairly close to hitting the mark.

So if you’re considering doing a do-it-yourself means test, remember that it’s a useful exercise to get a sense of your financial situation – but don’t rely on it. Doing so may lead to bad things in your bankruptcy case.

Image credit: seanfraga/Flickr


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Jay S. Fleischman is a bankruptcy lawyer with offices in Los Angeles and New York. He can often be found on Google+ and Twitter, where he shares information about consumer protection issues and personal finance.
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