With the volume of people declaring bankruptcy going through the roof, bankruptcy petition preparers have become militant. The amount of those filed for bankruptcy has proceeded to grow since 2008, with the expectation that 2011 would be a flat year. Do you want to learn more? Visit financial help.
Understandably, though it is unfortunate, for many in the bankruptcy filing business, it has been a prosperous period. Included in this rise is the move away from employing a bankruptcy attorney to seeking to save a couple of bucks using a bankruptcy claim preparer. It is really tempting and reasonable to seek to cut a few corners while you are experiencing financial trouble. There’s a lot of professional petition preparers out there, but the thing is because they don’t operate in the name of a bankruptcy solicitor there are a number of things they are not authorized to assist the claimant in legally. In reality, several preparers are paralegals to a bankruptcy lawyer. Any of them know very well how to file a case for bankruptcy as it comes down to it.
The question starts as the claimant gathers the documents to apply for bankruptcy. First of all, the preparer is completely powerless to provide legal advice. Technically, they can not also counsel the claimant about whether to bring a lawsuit under Chapter 7 or Chapter 13. The claimant would need to clear a liquidity check to apply for Chapter 7 bankruptcy. Legally, if the preparer fails to apply for bankruptcy under Chapter 7, he would not be allowed to provide any counsel to the debtor. Many times, if the claimant might delay filing for bankruptcy for a few months, instead of getting forced into Chapter 13, they could apply to file Chapter 7 bankruptcy. That’s a justification to devote a handful of extra bucks on a bankruptcy lawyer. The bankruptcy solicitor should be willing to look at the entire picture and warn their client on the ideal timing of bankruptcy filing where a petition preparer for bankruptcy doesn’t have the luxury.
Despite the massive rise in debt cases, many paralegals began moonlighting as paper preparers from their day-to-day jobs. Much of the bankruptcy trustees became irritated with the condition and began questioning and punishing those who breach the law. Any of these individuals promote cheap prices and also move above their limits by providing recommendations to their customers. In fact, a paralegal who does not operate for a bankruptcy attorney is not even permitted to counsel the debtors about what bankruptcy exemptions to use, whether it be local, federal or just to clarify what exemptions may be better for their case. Another field in which the bankruptcy trustee has difficulty is the price a preparer would bill. The bankruptcy code specifies that even the paperwork should be filled out by a bankruptcy claim preparer, thus paying a fair charge.