What is a Bankruptcy Petition Preparer?

This guy said he would only charge me $500 to prepare my bankruptcy…

This is something I go over in every initial consultation – you do not have to have an attorney to file for bankruptcy. However, attorneys are the only people who can give you legal advice specific to your situation.

I get quite a few inquiries regarding bankruptcy petition preparers who will “do your bankruptcy” for only $500. What are they actually “doing”? They cannot give you legal advice, appear at your Meeting of Creditors as your attorney, or even tell you how to list your property on your schedules. The only thing a bankruptcy petition preparer can do is type what you tell them to type on a form.

In addition, there are local court rules that often limit how much a non-attorney can charge to prepare your documents. For example, in the Oakland Division (Northern District of California), a non-attorney can charge a maximum of $150 to prepare your documents. The trustee will ask at the Meeting of Creditors how much you paid and I have heard ridiculous amounts – amounts close to what an attorney would charge.

If you do hire a bankruptcy petition preparer, please make sure that he or she follows the requirements for bankruptcy petition preparers:

1. Provide a written contract with a description of their services and total fees.
2. Provide you with written disclosures on the different kinds of bankruptcy and the process.
3. Identify as a debt relief agency under the federal bankruptcy code.
4. Not use the word “legal” or any similar term in any of their advertising or materials.
5. File a disclosure statement with the court that tells the court how much they charged you for bankruptcy petition preparation services.

No matter who you hire to help you with your bankruptcy, make sure that you read through every page of your bankruptcy filing before you sign it. You are signing under penalty of perjury that everything in the documents is accurate and correct to the best of your knowledge.

This is just a basic overview and is not legal advice specific to your situation. If you are considering bankruptcy or are feeling overwhelmed by debt, you should speak with an attorney in your area for legal advice. To speak with me regarding your situation, please email me at jen@jenleelaw.com or call 925-586-6738.