How to File for Chapter 7 Bankruptcy
Posted by Stephen Cline on January 21st, 2010
Review
In these times of massive credit card debt and stagnating incomes, filing for bankruptcy has become the only relief for thousands of people. The information in How to File for Bankruptcy is so complete that a person can file virtually on his own, without needing to hire a lawyer. By no means does the book encourage filing for bankruptcy, but it will help anyone in serious financial trouble determine if bankruptcy might be a sensible course to take, and examines wha… Buy How to File for Chapter 7 Bankruptcy at Amazon
Tags: Bankruptcy, Chapter, File
This review refers to the 13th edition of the book, which does cover the new bankruptcy law revision of 2006. Please read the editorial and customer reviews as to why this book was so helpful.
The author does a good job explaining how to file your own bankruptcy “pro se” (which means you are your own attorney and responsible for finding the answers to your own legal questions.)
At the time the 13th edition was printed, the author didn’t know if any of the state bankruptcy courts would grant an indigent filer relief from the bankruptcy filing fee. This is because there was a difference between the federal agency that created the exemption document and the agency that says such requests can be granted. Apparently, this difference of opinion has since been resolved. In my state, Washington, the judge did grant me exemption from filing the court fee, a savings of over [...].
My bankruptcy was a pretty straightforward chapter 7, even though I had taken out a business license as a sole proprietor. As I had no clients and no business income, I could go ahead and file as an individual.
The author commends the reader for having taken charge of their financial crisis and having made the difficult decision to file for bankruptcy. It would also have been helpful if he’d included a few helpful tips on emotional and mental preparation. For example, people under stress tend to forget common sense advice like: get enough sleep, exercise, and healthy food. Organize all your financial records in a quiet and neat environment, etc. Write down what you’ve done and what you need to accomplish. And so forth.
In my case, because I could have been better organized, I ended up paying two times an amendment fee because I forgot to include all creditors on my mailing matrix and other related forms.
(As a side note, many credit card companies own their own credit collections agencies with completely different names. To be on the safe side, list both the original creditor and the “collection agency” that they supposedly “sold” the debt to in your bankruptcy forms. However, when totaling the debt, do not count the same amount twice. On your mailing matrix, include both the original creditor and any collection agencies they have sold their debt to. This will cover your rear end. If you list only the collection agency and not the original creditor, you might be responsible for paying off the debt because the original creditor wasn’t listed in your bankruptcy forms.)
Student loans are usually not discharged but you should go ahead and list them anyway so the judge knows your total debt load.
Most filers choose to hire an attorney. I was one of three people who chose to go “pro se” out of over 30 filers. That really surprised me. My meeting with the trustee lasted less than five minutes.
Just because someone goes with an attorney doesn’t mean that attorney will be complete and thorough. I witnessed two attorneys who did not properly prepare their clients for potential questions the trustee asked, all of which are described in this book in a special listing. In my case, the trustee did not ask all the questions listed in the book but I was sure glad the author listed them so I could be prepared in case he did choose to ask them. Did those people get their money’s worth? I don’t know.
The creditor’s meeting is when you can tell the trustee if there have been any changes since you first filed for bankruptcy. Since this meeting is recorded now is the time to tell them. In my case, I reported assets I had failed to list (hobby supplies, etc.), assets that had been stolen from my home this month, and a car I no longer owned as it had been auctioned off by a towing company.
The two biggest reasons people file for bankruptcy are medically related and poor credit card usage. Both those reasons fit my profile. (Actually, I was very good at using a credit card as I remember charging them to the limit.) I cut up all my credit cards and now use only my debit card, cash, or checks. I now have a financial budget and feel like a load has been lifted off my shoulders.
The only reason I have for repairing my credit rating is if I choose to buy a house. At this time I don’t have any plans for doing so. However, for those who do want to improve their credit score, your best bet is to see if your local credit union or bank will give you a secured credit card, which will only allow you to “charge” amounts that you have placed in a special account tied to the card. It is a combinations debit and credit card. You can only “charge” what is in your secured account but you get the protection and benefits of a credit card.
The new law states that filers must take a pre and post budget class. These cost money in Washington state.
If you choose to go “pro se” but hire a typist to prepare your documents, you are still responsible for all the information contained in the forms.
Beware that your filing is public knowledge. I was surprised at the number of predatory lenders that sent me mail immediately after I filed. There was also one attorney who sent me a solicitation letter. You must shred all these letters for your own good.
I can’t say enough wonderful things about this book!
6 months ago I was contemplating bankruptcy. I searched for a book to help me and decided to buy this one. Honestly, I figured I’d read it, be more confused than ever and have to hire an attorney.
That’s NOT what happened. I took a weekend and studied every page of this book and took notes. I filled out and filed my bankruptcy petition on my own. Today, I attended my creditor’s meeting. Now, in just 2 months, I’ll receive my discharge. All WITHOUT a lawyer!
Filing bankruptcy without a lawyer is more time consuming, but the money saved is worth it. Just take your time and study this book and you’ll be fine.
Thank you, Nolo. Buying this book was the best thing I’ve done this year.