Why a DIY Bankruptcy is a Bad Idea

The Internet is usually a wonderful resource, but sometimes it doesn’t do people any favors. It has, for example, convinced people who are already scared and in a state of financial distress to save some money by attempting to represent themselves in bankruptcy cases (the legal term is ‘filing pro se’).

And this has done so many people such a disservice, especially right here in St. Louis, where many people struggle to make ends meet.

Instead of helping people, the pro se craze has resulted in lost homes, dismissed cases, and even jail time for some people who were just trying to get a fresh start. Here are some specific reasons why you want to think twice before launching your own case.

One mistake can destroy your case.

One missed form. One forgotten requirement.. One misunderstood question on the big packet of federal and state forms you’ll have to fill out. A failure to meet the requirements of the form of bankruptcy you’re trying to file.

This is all it will take for the judge to throw your case out. And he or she will not be lenient about it just because you’re filing pro se. Indeed, you’re held to the same standard as a lawyer when you make this decision. You’re expected to know exactly what your lawyer would know.

Pretty intimidating, when you haven’t been to law school.

See also: Who Qualifies to File for Chapter 7 Bankruptcy?

There are a whole host of actions that can get you into trouble.

Some of those actions include things you might have done before you ever thought to file for bankruptcy. Certain actions can look like fraud, and many of them come with a time limit.

For example if you use credit cards for more than $600 in luxury goods within a 90 day period prior to filing looks like an attempt to defraud creditors, because it looks like you never had any intention of paying the debt. And that’s just the tip of the iceberg.

Helping you avoid these pitfalls is one of the reasons why you’d file in the first place.

You might lose assets you could have kept.

Filing the wrong form of bankruptcy could mean losing your house or your car when you could have kept them. Failing to claim your exemptions correctly can result in the same thing.

And it’s almost impossible to get that property back after the fact.

See also: What is Exempt Property in a St. Louis Bankruptcy?

If a creditor makes a motion you won’t know how to handle it.

When you launch a bankruptcy case you’re launching a case your creditors may well be in opposition to. While some bankruptcy cases move through the courts without creditors saying a word, others don’t.

What will you do if your creditor files a motion for a relief of the automatic stay? Do you know how to answer it? Do you understand what all the other motions they might file might mean for you and your case, and what to do about them? Bankruptcy can get complicated fast.

Most DIY Chapter 13 cases fail.

There’s is a less than 1% success rate for pro se filers attempting to file Chapter 13 bankruptcy. Even designing a payment plan the trustee might accept is difficult. In some cases it’s possible to reinstate the case, but it’s difficult. And if you can’t get the case reinstated, filing it a second time within a one-year period vastly limits bankruptcy’s power. You’ll gain just 30 days of automatic stay protection, for example. That’s not enough if you’re trying to keep your house, or hold lawsuits at bay.

See also: Considering Chapter 13 Bankruptcy? There Are Some Requirements.

Instead of trying to go it alone, consider calling our offices for a free consultation. We can help you successfully navigate your way through your bankruptcy case, and it will cost less than you think. Call us today.