New to BK...Should I go Pro Se?

[BKisSucky]

Hi All,

First of all, great forum. I have been on the artofcredit forum for a few years now, which taught me pretty much everything I know about credit. Came here looking for specifics on BK, as forums have proved very useful to me in the past.

That said, I do have quite a bit of knowledge about credit, the FCRA and FDCPA, etc. What I don't know a lot about is BK.

I definitely know I need to file a BK. It works to my family's benefit, as we are in debt pretty bad with no end in sight. I had PERFECT credit as of June or July of 2005. No lates, past dues, collections, charge-off, NOTHING. Then, I had a baby, hubby lost his job, bills stopped getting paid, and now I am here. Yay for traumatic events!

Our Ch. 7 should be extremely easy. We don't own property, and most of our debt is unsecured. I do have a student loan that I know I will have to pay, but other than that it should be really easy. The only line of credit I want to keep is my car loan.....

I have been doing some research on BK lawyers in my area. I think I can get it done for about $1500 total. I don't want to come out of pocket for this if I don't have to. Especially if it is really easy to do. I am pretty knowledgable about credit issues and almost went Pro Se before, but never had to as it was settled out of court. Bottom line, I think I am competent enough to do it myself, but smart enough to know that having a lawyer do it is the best route.

So what should I do? File myself? If so, how do I start? I was just going to go to my local courthouse and get it going. Or do I play it safe and just have a lawyer do it? Saving $1500 is sounding pretty good at this point....

Any advice is greatly, greatly appreciated.

Thank you!

Brandi

[StaciMM]

I would say to not make a decision just yet on filing pro se. Research all you can on BK, get your things in order as far as who you owe & what you spend for normal living expenses. Consult with several BK attorneys. Key things to ask them about would be exemptions for your area, and what to expect/what steps are involved. Once that is all said & done, THEN decide whether going on your own is what you want.

Hopefully, some who filed after 10/17 will post about what was involved for them, as there are some differences now. (I filed pro se under old law, had no issues, but the extra red tape now would make me nervous to file without an attorney.)

[SinkingFast]

We are prepping to file New Law so I can tell you a lot of what you are gonna need.

Let me say one thing first about using an attny, especially at this point with the Law being so new. Under the New Law, attnys are held accountable for the info provided in the filing. If a Trustee or the Judge sees inappropriate info, the attny is gonna get hit with a fine. So if your docs and such can pass muster with an attny who values their right to practice, you'll hopefully get thru the BK just fine.

-You will need 6 months of Pay Stubs.
-6 months of Bank Statements.
-4 years of filed Income Taxes with W-2's and other supporting income documentation. If you were laid off, you'll need your unemployment 1099. If you cashed out an IRA/401K, you'll need your 1099. That kind of thing.
-Supporting documentation showing termination of employment, severence benefits, etc.
-Titles to all your vehicles with detailed descriptions. Automatic, engine size, A/C, etc.
-Titles to any boats, motors, trailers, etc with detailed descriptions.
-Deed to your house or a current order of Title Work from a reputable Title Company.
-Current appraisals/valuations for your vehicles and/or home.
-Declare any property sold or transferred in the last 12 months
-Declare any bank accounts that were closed in the last 12 months.
-Declare any leases, including rental agreements, cell phone contracts, auto leases, etc.
-Declare and deposits held by any landlord, utility, etc, on your behalf.
-List of all creditors you're filing against with amounts owed and correct contact information.
-Pull copies of your Credit Reports and check thru those to be sure you don't forget to include a creditor for years ago that you may not remember.
-A current inventory of your household goods with fair replacement values. If you've recently purchased something new, that would be store retail. If it's a 10 year old couch, that would be Goodwill, garage sale, yard sale values.
-A list of payments to all creditors that total $600 or more in the last 90 days.

There's more. That's a list of the biggies. A place to start at least.

http://www.usdoj.gov/ust/

You can access the Means Test and BK petition schedules at the DOJ website above.

The problem you might have with the Means Test is figuring the Trustee's Administration fee for a potential Ch 13. I don't know how to do that. I've asked attnys but no one explained it to me. I came up with $115/mo disposable income and learned I hadn't figured other things in on the Means Test. We have a house for sale outa state and we can annualize what we've paid in house payments there over a 60 month period and list that amount in on the "Other Secured or Priority Debt" section. Our attny said the Admin Fee alone would eat a significant chunk of the $115/month. I've seen BK Filings on PACER where the Admin Fee runs $75 and more per month.

You can read about the New Law at FindLaw or Nolo.com, or various other websites.

Research your state's exemptions. There's a section in the Forum here for that, but several states recently updated with the change in the Federal Law coming.

[StaciMM]

Sinkingfast-I don't think you'd include the other house payment in your budget, since you won't make that after the BK.

[FilingOnMyOwn]

Plan to do lots of homework. Even if you do end up hiring an attorney, the knowledge will still help and be good peace of mind. I successfully filed pro-se because I had absolutely nothing to lose. If you have any assets or disposable income to lose, you need to be very careful and make an extremely educated decision.

[SinkingFast]

Sinkingfast-I don't think you'd include the other house payment in your budget, since you won't make that after the BK.

That's what we thought. One of the first attnys we Consulted with said the same thing. So we hadn't mentioned anything about house expenses to any of the attnys. This attny asked if we had included the house payments when I ran the Means Test. I said Nope. He said we could include the housepayments. It's a Secured Priority Debt we've been responsible for. He pulled out the Code book, found the Code and read the rule to us.

He said the Means Test isn't just a 6 month snapshot of income, it's a snapshot of expenses as well. Even tho we aren't keeping the house, it's expenses we've been paying that have contributed to the financial situation. He asked how long we'd owned the house. 15 years. He said it's not a problem to go back and annualize the payments out over 60 months then.

We don't need the expense to go Ch 7 but the attny said he could include it if he had needed it.

[StaciMM]

Perhaps for the means test (which is still a 'new' thing everyone is adjusting to), but I'm pretty sure most trustees would find it highly questionable to list both a house payment & a rent payment on the expense schedule.

[nicolemarang]

i did it- you can too!

I'm not going to go into Huge Detail as above but I was in your exact SAME BOAT. Lost my job had a baby, blah blah blah. We were going to file bankruptcy so we contacted a lawyer. Most of them have a free consultation!! We found this to be VERY HELPFUL!! They told us we were a good candidate and actually gave us the paper work for leagal limits for expenses and what not! We couldn't afford to hire a lawyer so we had a document preparer (they do this for a living) Fill out all our paperwork. They ask a few questions and you provide them with all of your bills and collections statements!! He filled out all the paperwork and it costed only $200.00!! We had student loans and kept our car loan as well! The document prepairer can't give you legal advice but they do have tons of information so you can pick their brains as well. We However, did not have a mortgage due to the fact that we rent in an apartment. IF you want to look into this route we used a service called "Equal Access to the Law" I've also hear "We the people.." is pretty good as well. If you have little to no assets this maybe the way to go for you! I think its better than filling out your own papers, that way nothing gets missed!! Our debts have been dissmissed and just waiting on closing now!! IT worked for us, maybe it can work for you too!! Good luck.
***WE also filed before the new laws were passed so I'm not sure about the requiered credit counseling or whatever.

[SinkingFast]

Perhaps for the means test (which is still a 'new' thing everyone is adjusting to), but I'm pretty sure most trustees would find it highly questionable to list both a house payment & a rent payment on the expense schedule.

The attny won't list the house payment on J. The house is going as part of the BK, so it won't be an allowable "present and future" living expense. The attny will just list rent payments on J.

The attny said when the Trustee looks at our rent, or any of our expenses for that matter, he/she may ask us, "How long are you going to live there?? Will your rent continue to be that high?? Will your son continue to live with you for a year, 2 years?? How long do you expect you'll need to accomodate a family of 6?? Do you plan to purchase another house in the forseeable future??" Evidently Trustees ask questions like that of Renters when they don't if you have a mortgage. Just guessing there. Not sure. Just the attny said it could happen. He ran thru a whole bunch of questions with us. Maybe to see how we would answer?? Not sure.

Our son will live at home another year and a half at least. He lives at home while he goes to college and works. He can transfer to a major University here in town. That would add another 2 years. We don't know how long Mom will live. Her mother was 93 when she died. Daughters are planning on living at home while they go to college. It is a realistic possibility we'll have 6 people for several years yet to come.

Our actual rent and utilities are MUCH higher than the IRS standards allowed for the Means Test. Our current rent is in line with what we would pay to get a 4 BR house or apt anywhere in town here. That will help equal it out somewhat when I and J are compared to the Means Test.

[cpw111]

I filed with the new laws and will edit SF's list with what I was required to give.

-You will need 6 months of Pay Stubs. **Only needed 3 months worth
-6 months of Bank Statements. **NONE
-4 years of filed Income Taxes with W-2's and other supporting income documentation. If you were laid off, you'll need your unemployment 1099. If you cashed out an IRA/401K, you'll need your 1099. That kind of thing.(Only last years tax return and trustee didnt ask for my refund at 341)
-Supporting documentation showing termination of employment, severence benefits, etc.
-Titles to all your vehicles with detailed descriptions. Automatic, engine size, A/C, etc. (no asset for me)
-Titles to any boats, motors, trailers, etc with detailed descriptions.(no asset)
-Deed to your house or a current order of Title Work from a reputable Title Company. (no asset)
-Current appraisals/valuations for your vehicles and/or home. (no asset)
-Declare any property sold or transferred in the last 12 months (did ask)
-Declare any bank accounts that were closed in the last 12 months.(no mention)
-Declare any leases, including rental agreements, cell phone contracts, auto leases, etc. (declared)
-Declare and deposits held by any landlord, utility, etc, on your behalf.(didnt)
-List of all creditors you're filing against with amounts owed and correct contact information. (MAKE SURE YOU LIST THEM ALL)
-Pull copies of your Credit Reports and check thru those to be sure you don't forget to include a creditor for years ago that you may not remember.
-A current inventory of your household goods with fair replacement values. If you've recently purchased something new, that would be store retail. If it's a 10 year old couch, that would be Goodwill, garage sale, yard sale values. (YES)
-A list of payments to all creditors that total $600 or more in the last 90 days.
(yes)
They also wanted to know about any pending lawsuits. $$$

So far it hs been painless but I know if anything is going to happen it will be around discharge day.
You will have to take a pre BK class and a post BK class for about $50 each.


Filed 12/28/2005 DONE
341 1/24/2006 DONE
Discharge 3/26/2006 Painstakingly waiting.

[StaciMM]

SinkingFast-sounds like the attorney is trying to prepare you for every question that might come up. I see that as a good idea! I wouldn't be surprised if trustees start asking more 'what if' questions regarding future plans.

Ironically, when we get our mortgage, it won't really reduce the amount we're paying monthly. BUT we'll be owning the equity...

[SinkingFast]

You know, CPW,.......... The whole time we've been gathering all this stuff together I've wondered how much they are actually gonna look at.

The list I gave is stuff that all the attnys have said they want on file before we sign the BK Petition. Whether or not it actually makes it to Court, we'll see.

But, better to have it and not need it than need it and not have it.

I kinda guessed that's what the attny was up to Staci. Prepping us for the "what if's" a Trustee might ask.

[BKisSucky]

Thanks everyone for the advice.

My main concern is the fact that we rent, do not have any assets, etc. and I know our Ch. 7 will be as easy as they come. I would hate to have to pay an attorney so much $$ if it is just straight forward paperwork that needs to be filed. I also don't want to mess up by doing it myself either, so it is kind of a catch 22.

I like the idea of a document preparer. Seems like a happy medium. Aren't these usually paralegals that offer that service?

Thanks again guys!

Brandi

[StaciMM]

If you decide to go it on your own, you probably wouldn't even need a preparer. They can't do anything you wouldn't be able to do for yourself. And, since you are accountable for the paperwork-not them-you may hurt yourself if you rely on the wrong company. Bookmark form7.com. They don't have updated software/forms available for post 10/17 filers, but may at some time in the future. They have a fill in the info process, where you can then print out all the forms. You can edit/adjust as necessary. I used them, and the $35 was a great value.

The plan to research and find out all you can, regardless of whether you use an attorney not, is a good approach.

[SinkingFast]

If you're below the Median income for your area, the Means Test won't even be an issue for you. You'll fill out the MT up to line 15 and stop there.

The only problem area I saw for regular folk on the MT was calculating the Trustee's Admin Fee/month. Charts will tell you the %'age, and all you have to do is multiply. But multiply that % times what?? Times the total you owe all your Creditors?? Times 25% of what you owe to all your Creditors. Times the total of your actual pay back in the plan?? What?? That was the problem I had with figuring that portion. And, no attny would tell me how they do it either.

If you file Pro Se, either the Trustee or the Judge will advise you legally speaking about the pro's and cons of any reaffirmations you may be asked for by Creditors. The Court can't tell you to sign or not sign, but they will advise you about the legal aspects of both sides of the issue.