The internet age has made many things DIY-friendly, with videos, instructions, and charts making it easier than ever before for you to learn how to change a tire or make bread from scratch. However, just because the internet makes it possible for you to do almost anything on your own, this does not necessarily mean that you should. In fact, certain things are best handled by trained, experienced professionals, such as filing for bankruptcy.
The fact is that filing for bankruptcy is an extremely stressful situation to find yourself in, and you do not want to make this time more difficult for yourself by trying to go through the bankruptcy process alone. While some people may choose to forgo hiring an attorney in order to save money (this is known as filing Pro Se), this is a critical mistake, as an attorney can be invaluable in guiding you through this complex and confusing process. What many Pro Se filers do not realize is that DIY bankruptcies are risky, as you may find yourself making costly errors if you try to go through this process alone.
For instance, in California’s Central district, over a quarter of bankruptcies are filed Pro Se (compared to an average of less than 10% nationally). Of these Pro Se filers, only 60% of filers were successful in discharging debt according to a survey conducted in 2011. This pales in comparison to the 94.5% success rate seen in those who had an attorney. This makes it critical that those seeking to file for bankruptcy consult an attorney before doing so, as there are many pitfalls that can come with attempting to file Pro Se. If you are considering filing for bankruptcy, here is a look at just a few of the dangers that come with attempting to do so on your own.
You May Miss Out on Alternatives to Bankruptcy
What many people do not realize is that they may not need to file for bankruptcy. Even if you believe that you’ve reached a point where bankruptcy is your only option, there may be alternative routes to help you achieve financial peace. For instance, depending on your financial situation, you may be able to negotiate with your creditors instead of filing for bankruptcy. Negotiation may buy you some time as you try to get back on your feet financially, which makes it critical that you consult an attorney before you file bankruptcy. An experienced attorney can help you go over your options, and they may be able to work with your creditors on your behalf to reach an agreement to settle your debts for less than you owe. Unfortunately, people often don’t realize that they have options, or they are misguided on what bankruptcy does, and when it is necessary, and they end up filing for bankruptcy unnecessarily.
You Risk Filing The Wrong Type of Bankruptcy
If you decide that filing for bankruptcy is still the best option given your financial situation, working with an attorney is critical in ensuring that you choose the right type of bankruptcy. While the logical choices are Chapter 7 and Chapter 13 bankruptcy for most people, each type does different things, and which option is best for you will depend on what you are hoping to achieve when filing for bankruptcy. For instance, if you want to save your home from foreclosure, chapter 13 may be your best option. Unfortunately, many people who attempt DIY bankruptcies choose the wrong type, which can cause them to lose valuable property and/or not discharging certain debts. Fortunately, a skilled bankruptcy attorney will have experience handling cases similar to yours, and they can help you to determine the right course of action based on your unique financial situation and your goals for filing bankruptcy.
You May Not Know Procedure
One of the most common problems people encounter when attempting a DIY bankruptcy is making costly mistakes because they simply do not know the proper procedure. For instance, when filing for bankruptcy, proper notice must be given to creditors or other parties when papers have been filed or hearings have been set. If you fail to give proper notice, a court will not rule in your favor. However, figuring out who to notify, how to go about this, and when particularly parties need to be notified is complicated, which leaves DIY filers vulnerable to making costly mistakes.
Mistakes are Common
While the many resources that the internet provides you with may make it seem like filing for bankruptcy on your own won’t be that complicated, this is far from the case. Bankruptcy law is extremely complex, and if you try to go through the process of filing for bankruptcy alone, you may quickly find yourself overwhelmed by complicated paperwork and confusing legal jargon. Should you make a mistake filling out this paperwork, this could lead to costly delays, or worse, if you forget one of the required documents all together, your case may be dismissed. In fact, 21 percent of Pro Se debtors filed an incomplete petition package in California’s Central District in 2014, and over 99% of these petitions were subsequently dismissed. A bankruptcy lawyer can then be instrumental in ensuring that the filing process goes as smoothly as possible, as they will make sure that you understand each step of the process, and they will be there to ensure everything is done correctly the first time.
Mistakes Can Be Costly
As we previously hinted at, should you make a mistake or miss a form while filing for bankruptcy on your own, there could be disastrous consequences. If you make a serious mistake and the court dismisses your case, not only will you be back where you started, but you may even find yourself in a worse financial situation due to additional interest that has accrued and the fact that creditors may be angered by the delays. Furthermore, if you decide to file for bankruptcy again, you may encounter roadblocks because of your previous filing. For instance, courts often dismiss cases with prejudice, meaning that you cannot file again for a given period of time after your previous filing unless you or your attorney can get the prejudice period shortened. Working with an attorney is then critical, as having someone with experience to guide you through the bankruptcy process will greatly improve your chances of succeeding the first time.
Don’t Risk a DIY Bankruptcy: Consult an Attorney to Help You During This Difficult Time
Going through the process of filing for bankruptcy can be difficult and stressful enough without trying to go through this uncertain time alone. Working with an attorney can help to ensure that you have someone by your side, looking out for your best interests at each step of the way. While going through the court process and dealing with a bankruptcy judge can be overwhelming, an attorney can help ensure that you are prepared for each meeting and that you have a correct and accurate testimony prepared. Having an attorney by your side can mitigate any issues that may arise during the process of filing for bankruptcy, helping to ensure that your case is settled as quickly as possible.
Unless you have experience handling bankruptcies, you may be surprised by how complicated this process can be should you attempt to file for bankruptcy on your own. Contact us to learn more about filing for bankruptcy including why it is so imperative that you work with an attorney from the start.