How can I get help filing bankruptcy?

Filing bankruptcy without an attorney, or pro se, is not uncommon, although most people do hire a bankruptcy lawyer to make sure no mistakes are made. The only way to get legal advice regarding bankruptcy is to talk to a lawyer, unfortunately. The US Bankruptcy court recommends that all bankruptcy petitioners be represented by a bankruptcy attorney, although it can be done without one.

If you want to talk to some bankruptcy lawyers about fees and your case, click here, otherwise read on.

I will try to outline some of the main things to consider, as well as offer up some resources for you to learn more about bankruptcy and how to plan for it and what to expect.

A Note on Bankruptcy Petition Preparation Services

There are some bankruptcy petition preparation services, but you should avoid them. These services can only fill out your paperwork, and it's illegal for them to offer you advice so most won't. If you've got a type writer or a computer, then a petition preparer really can't do anything for you unless you have trouble with English.

Bankruptcy Planning

Before you do anything, you will want to take a few steps to ensure your filing the correct type of bankruptcy as well as protecting assets that you want to keep.

1. Choose Where You Spend Your Money Wisely

Once you've considered bankruptcy, you need to pick and choose what bills you pay. Unsecured debt, such as credit cards, can usually be put on the back burner. Aside from child support and other family law obligations, unsecured debt will be erased by bankruptcy.

If you're falling behind on your mortgage payments, you may need to expedite your bankruptcy filing. You usually have about three to four months of past due mortgage cycles until the lender will take legal action in the form of a foreclosure lawsuit. Once this has been done, you will want to file your bankruptcy petition so that they are barred from doing anything further.

2. Do Not Touch Retirement Funds!

This is important. Many people will get cash out of their 401k, IRA or other retirement accounts. This is a mistake, because in most cases it only delays the inevitable. The bankruptcy court will protect these assets, so don't touch them, otherwise they will be gone forever.

3. Tax Returns

If you are anticipating getting a tax return, you may want to get it BEFORE you file for bankruptcy. While tax returns are not exempt from bankruptcy, you can use the money to pay court fees, and legal fees if you do decide to hire an attorney.

4. Go to Pre-Bankruptcy Counseling

Even if you never end up filing for bankruptcy, go to the pre-bankruptcy counseling classes. It only takes an hour or two, and you will learn a lot about bankruptcy and how you can use it to protect yourself and your family.

Personal Bankruptcy Intro

Personal bankruptcy filers generally have two options: Chapter 7 or Chapter 13. Both types of bankruptcy have thier pros and cons, as well as income requirement. Ultimately, the type of bankruptcy for which you file will depend largely on your level of income.

Chapter 7

Under a chapter 7 bankruptcy, a bankruptcy trustee will be assigned to your case to evaluate your assets and debt, and liquidate some of your property to free up cash and pay your creditors. Your home and some other property are generally exempt, meaning the trustee cannot sell it.

Additionally, there are legal strategies that will allow you to keep non-exempt property, but that depends largely on your particular situation. Many people would like to keep a car, so they will often reaffirm that debt, which means they choose not to include that in the bankruptcy and instead continue to pay off the debt.

In order to be eligible for chapter 7 bankruptcy, your income must be very low in order to pass the means test. The means test is designed to figure out how "able" you are to pay off your debt without bankruptcy.

Chapter 13

Many people try to file for chapter 7, but are unable to pass the means test. In this case, they usually file for a chapter 13 repayment plan instead.

In a chapter 13 bankruptcy, a trustee is also appointed to handle your case, however, the function of the trustee is different. He or she is responsible for working out your repayment plan amongst your creditors and yourself.

In a chapter 13 repayment plan, you will be given a plan that you can afford and must adhere to for 3-5 years, until all your debts are repaid (at least in part).

Below you will find some links to more information written by professional bankruptcy attorneys about bankruptcy.