Cheap filing risks · Beverly Hills
What Goes Wrong in a Cheap Bankruptcy Filing
What goes wrong in a cheap bankruptcy filing is usually a missed choice that only a lawyer can make: the wrong exemption system, a missed asset, a bad means test or a missed deadline. Those mistakes can cost you a car, a house or the whole discharge. Call (310) 362-9071 to have your options reviewed before you file.
- Petition preparers are not lawyers and cannot give legal advice
- They cannot speak for you in court or at your 341 meeting
- Our Chapter 7 flat fee starts at $1,200 plus the court filing fee, with payment plans
At a glance
What a petition preparer can and cannot do
A bankruptcy petition preparer is a non-lawyer who types your forms for a fee. Federal law, 11 U.S.C. 110, limits what they can do.
A petition preparer can type the information you give them into the official forms. A preparer cannot:
- Tell you which chapter to file
- Tell you which exemptions to use or whether you can keep your house or car
- Tell you whether a debt will be discharged
- Explain the means test or your duties to the court
- Speak for you at the meeting of creditors or in court
Those are legal questions, and only a lawyer can answer them. With a preparer, you make every legal choice yourself. The same is true for online do-it-yourself software.
Common errors in cheap filings
- The wrong exemption system. California has two exemption systems. System 1 has a large homestead exemption. System 2 has a large wildcard but a small homestead. Picking the wrong one can expose a house, savings or a car.
- Missed or undervalued assets. A tax refund, a lawsuit claim, a car in your name that a relative drives, or money owed to you must all be listed. Leaving something out can cost you the property or the discharge.
- A wrong means test. Using take-home pay, leaving out a spouse's income, or filing in the wrong month can block Chapter 7.
- Filing too soon after transfers. Paying back a relative or putting property in someone else's name before filing can be undone by the trustee.
- The wrong chapter. See Chapter 7 or Chapter 13. Someone behind on a house may file Chapter 7 and still lose it, when Chapter 13 could have saved it.
- Missed deadlines. The course certificates, documents for the trustee and tax returns all have deadlines. Missing them can end the case without a discharge.
- Signing a reaffirmation without advice. Agreeing to keep paying a debt can leave you owing it after bankruptcy.
What happens when a filing goes wrong
A bad filing can lead to:
- Dismissal. The case ends with no discharge. Your debts are back.
- Weaker protection next time. If a case is dismissed and you refile within a year, the automatic stay may last only 30 days unless the court extends it.
- A 180-day bar. Some dismissals keep you from refiling for 180 days.
- Lost property. The trustee can sell non-exempt property that a better plan might have protected.
- A lawsuit in the bankruptcy court. Hidden assets or recent transfers can lead to an adversary proceeding against you.
Fixing these problems often costs far more than doing it right the first time. See refiling a dismissed bankruptcy if this has already happened.
Comparing the real cost
| Question | Petition preparer or software | Bankruptcy attorney |
|---|---|---|
| Who picks the chapter and exemptions? | You do | Your lawyer advises you |
| Who goes with you to the 341 meeting? | No one | A lawyer appears with you |
| Who answers the trustee's questions and requests? | You do | Your lawyer handles them with you |
| Who responds if a creditor objects? | You do | Your lawyer |
| Up-front cost | Lower | Our Chapter 7 flat fee starts at $1,200 plus the court filing fee |
We offer payment plans and a free consultation. See what bankruptcy costs for the full picture.
What to watch for
- Promises about results. No one can promise you a discharge.
- Anyone who gives legal advice but is not a lawyer. That is not allowed.
- Pressure to file fast without a review. Timing affects the means test and exemptions.
- No local knowledge. Your case will be handled under the Central District of California's rules and trustees.
What it costs
- Chapter 7: flat attorney fee from $1,200, plus the $338 court filing fee
- Chapter 13: attorney fee quoted in writing, and part of it can be paid through the plan
- Payment plans are available, and the first consultation is free
More on choosing a chapter
- Chapter 7 or Chapter 13: Which One Fits You
- When You Should Not File Bankruptcy
- What Goes Wrong in a Cheap Bankruptcy Filing
- Rebuilding credit after bankruptcy
Questions about cheap bankruptcy filings
Can a bankruptcy petition preparer give me legal advice?
No, a bankruptcy petition preparer cannot give you legal advice. Federal law bars them from telling you which chapter to file, which exemptions to use or whether a debt will be discharged.
Is it safe to file bankruptcy without a lawyer?
Filing bankruptcy without a lawyer is legal, but it carries real risk. Simple cases can go smoothly. Cases with a house, a car with equity, recent transfers or high income are where mistakes happen most.
What if my cheap filing was already dismissed?
If your cheap filing was already dismissed, you may still be able to refile. Your stay protection may be limited, so call us quickly.
How much does a lawyer cost for Chapter 7?
Our lawyer fee for Chapter 7 is a flat fee that starts at $1,200 plus the court filing fee. Payment plans are available, and the first consultation is free.
Free consultation
Get it right the first time
Call (310) 362-9071 or send the form. We will review your case for free before you file anything.
Law Offices of John Asuncion9454 Wilshire Blvd., Penthouse Floor
Beverly Hills, CA 90212
(310) 362-9071
Monday to Friday, 9 a.m. to 6 p.m.