Bankruptcy ?
Q: I live in Massachussets. My girlfriend thinks she need a lawyer to file for bankruptcy and says she has to pay her lawyer $1,000 to file for bankruptcy. This seems pretty ridiculous since she doesn't even have enough money to pay the lawyer. Can't she just file herself or get inexpenive assistance ?
A: -It's not legally required to hire a lawyer, but it is advisable. Look around for low cost clinics that might help. Is there a lawschool nearby? They might have something like that. -Here's the deal. The lawyer can get paid because the rest of the unsecured creditors get stiffed. Sure, she could file it herself, and most of the time it would work out OK. The forms are really no more complicated than tax forms. BUT, if something goes wacky, it's good to have a professional doing the work. -Your local county law library will certainly have practice manuals (Williams; Norton; Epstein-Nichols-White; and/or the encyclopedic Collier on Bankruptcy). Consulting those is probably overkill, and assumes a legal knowledge she is unlikely to have. That said, there are good reasons why do-it-yourself bankruptcy is a bad idea. Your friend is unlikely to know that any inheritance she gets within 180 days of a bankruptcy filing becomes part of her estate and goes to her creditors. She probably won't know the fraudulent conveyance laws, the preference rules, the status of secured debts and the need to decide on reaffirmation issues. She will not know about bad-faith questions, and non-dischargeability; when a Chapter 13 is a good idea; or how to fill out schedules I and J (income and expenses) to avoid embarrassment and possible nondischargeability issues at her 341 meeting of creditors. However, if all her debts are credit card debts over 90 days old, medical bills and the like perhaps she can succeed by herself. Or perhaps you can find a free clinic where she can at least talk to an experienced lawyer. But she may have much more than $1,000 at stake to lose. And filling out the forms can be daunting. What I do not recommend is the use of a "petition preparer" -- who are all over the Internet. Most provide incompetent legal advice unlawfully. Both petition preparers and lawyers