Most bankruptcy cases will significantly benefit from the help of an experienced lawyer. It’s possible to handle a simple bankruptcy with only a few assets on your own. But if you have notable assets, are filing for chapter 13, are accused of fraud, or have any questions, hiring a bankruptcy attorney is a good investment.
Learn how a bankruptcy lawyer can help your case, and explore other low-cost options for filing.
The role of a bankruptcy attorney
A bankruptcy attorney will use their experience to help make sure your case gets the best possible outcome. They can assist you in several different ways, including:
- Explaining your options and eligibility.
- Explaining the legal terms and process of bankruptcy.
- Completing and filing legal forms.
- Helping you keep valuable property.
- Representing you during the meeting of creditors.
- Stopping debtors from harassing you.
- Preventing your case from being dismissed by the courts.
Handling bankruptcy without a lawyer
If you’re unable to pay an attorney to handle your bankruptcy, you can file for bankruptcy pro se (without legal representation).
Filing for bankruptcy on your own will be easier if your case is simple. For example, if you have limited assets, no creditors who are claiming fraud, and you decide to file for chapter 7 bankruptcy, it’s unlikely that your case will be dismissed.
However, it is always a good idea to at least talk to a lawyer. They can help you understand your situation and familiarize you with your options if you need help later in the process.
When you need a bankruptcy attorney
There are several circumstances where you should almost always hire a lawyer. If you own a business, are filing for Chapter 13, or have significant assets, going without a lawyer puts your belongings in jeopardy and may end up lengthening the process.
Forgetting to disclose all your debts or improperly filing the bankruptcy forms will hurt your case, which may then be dismissed by the court. If your case is dismissed, you will still be responsible for your debts.
Having a lawyer is particularly important if your bankruptcy trustee accuses you of fraud. The bankruptcy trustee is the person appointed to oversee your case and look for any major concerns. Accusations from the trustee could mean civil or even criminal penalties.
To avoid accusations of fraud in the first place, be upfront about all of your assets.
Low-cost bankruptcy help options
If your case is complex and you don’t think you can afford a bankruptcy attorney, you still have some options.
First, you can search for a pro bono lawyer. If your income is below a certain level, a lawyer may take on your case for a small fee—or perhaps even for free. To find such a lawyer, contact your local legal aid office.
Alternatively, you can reach out to the American Bankruptcy Institute, which may be able to put you in touch with a knowledgeable attorney who will help you as a service to the community.
Applying for free help means that your bankruptcy attorney options are somewhat limited. However, you should still try to find a lawyer who can help you manage your debt in ways that might involve not filing for bankruptcy at all.
You can also find a bankruptcy petition preparer to help you fill out and submit the necessary documents, usually for a one-time fee of $100 to $200. However, keep in mind that petition preparers generally have no formal legal training. Hiring an attorney to at least review your forms, will save you time and money in the long run.
Possible outcomes of bankruptcy
After your bankruptcy, don’t expect to be totally free from debt. Chapter 7 bankruptcy will discharge most of what you owe. But you’ll still have to pay certain types of debt, such as:
- Some forms of tax debt
- Government-funded student loans
- Fines for breaking the law
- Child support and alimony
- Cooperative housing fees
- Debt that you incurred by causing personal injury through your operation of a car or other motor vehicle
- Federal tax liens
Chapter 13 can help you with some types of debt that Chapter 7 cannot touch, such as debts for willful injury to property.
Even if your bankruptcy discharged only a portion of your debt, you’ll still experience relief from creditors. However, a bankruptcy on your credit record can make rebuilding your assets in the future difficult.
Filing for bankruptcy is a complex procedure, and specific laws about bankruptcy vary from state to state. If you have any doubts that you’ll be able to handle the process by yourself, you talk to a qualified attorney.