Filing for bankruptcy is not easy and the US legal system outlines several steps for doing so. There are primarily two ways of filing for bankruptcy that you could use and knowing complete details about them is essential to get full benefits.
You can file for bankruptcy under two chapters, namely, Chapter7 and Chapter 13. While the state states that corporations and partnerships cannot file for bankruptcy without the help of an attorney, individuals in California can do so. When individuals file for bankruptcy without a lawyer, it is known as ‘pro se’.
While filing for bankruptcy alone individuals have to handle the case carefully or else they may only add to their troubles. The law is very technical and without problem guidance, there are many pitfalls you can find yourself in. Thus before you decide to go alone, understanding the problems you are likely to face are very important. Let us take a look at the problems you might face while filing bankruptcy without a lawyer.
Not Knowing Which Chapter to Use: You would probably be thinking that basic knowledge on Chapter 7 and Chapter 13 is enough to file a bankruptcy case alone. But that is not the case. There are specific rules on when you can use Chapter 7 and when you can use Chapter 13. For example, for foreclosure, Chapter 13 is the best choice and for low income with no assets, Chapter 7 is the suitable choice. Filing under the wrong chapter will mean you have created more trouble for yourself and run the risk of having your case dismissed.
Filing under Chapter 13: Chapter 13 has several difficult clauses and filing for bankruptcy under this chapter without the help of an attorney can be disastrous. There are several reasons where Chapter 13 is used such as for catching up on mortgage arrears, getting rid of second mortgage, cramming down on car loans etc. In each of these instances, there are several forms to be filled (of which you have to at least know before even filling them out). Once the forms are filled, you also have to plan a repayment plan (and doing this without legal guidance is going to be difficult). It should be noted that most of the Chapter 13 cases which are filed ‘pro se’ are dismissed by the court.
Complicated Chapter 7 Procedure: Chapter 7 usually looks simple but they are not. There is extensive paperwork to be done, financial documents to be gathered, adequate and up-to-date knowledge on research bankruptcy and exemption laws etc. If you are declaring bankruptcy of your business, or there are chances of creditors claiming fraud against you, Chapter 7 can be used. If not applied properly, your case might be dismissed, you might face lawsuit or your assets might be sold or taken over. Thus your problems will only increase without an attorney in California.
Bankruptcy fraud is a crime and without proper guidance you might just commit a crime unknowingly. Thus it is always better to take the help of an attorney.
This post is shared by Attorneyforbankruptcy.com, which a leading law firm of California. Here you can have detailed information on california bankruptcy lawyer and consumer dept consolidation.