Can you file for bankruptcy on your own?

Can you file for bankruptcy on your own?

You are having a hard time keeping up with your bills, money is tight, and the last thing you may want to do is to spend a couple of thousands of dollars on a bankruptcy lawyer. So you ask yourself, do I really have to have a bankruptcy attorney? Can I simply file my case on my own? After all, I have read all kinds of stuff on the internet and we are after all in the “DIY” (do it yourself) era are we not? The answer is yes, of course, you can file your bankruptcy case without the assistance of an attorney, but (you knew there was going to be a “but” right) you may quickly find out what people mean when they use the phrase “penny wise and pound foolish.” Case in point, see what one individual posted on a couple of weeks ago:

“how can I get a dismissal of a filed chapter 7. I have a car that is NOT mine but belongs to my son, but was titled in my name to get a better rate on insurance. Now the trustee wants to sell my sons car to pay my debts.” In other words, what they are saying is they filed a chapter 7 bankruptcy case and there is a car that is titled in their name, paid off, and worth –let’s just say- $12,000. The trustee is claiming that he is entitled to take possession of the car, sell it, and distribute the funds to their creditors.

So, how can you get a dismissal of a chapter 7 case? You cannot. Once a chapter 7 case is deemed to be an “asset case” a judge will not allow you to simply say “oops” and allow you to voluntarily dismiss the case. Once you are in it, you are in it!

Having said that, how would a bankruptcy lawyer deal with this dilemma? Well, a good Virginia bankruptcy attorney is of course intimately familiar with Virginia’s bankruptcy exemptions. Maybe it is just a matter of applying the $6,000.00 car exemption and utilizing 34-4 to protect the remaining equity in the car. And if the car is worth a bit more than the available bankruptcy exemptions then perhaps you purchase the car back and pay for the un-exempt portion. Or, if the car has a great deal of equity and is worth a lot then you may have to convert to a 13 and pay off the car over 5 years. Finally, if you are an experienced Virginia bankruptcy attorney you realize that you may be able to convince the trustee/court that the debtor –the person who filed for bankruptcy- has merely “bare legal title.” Meaning, you may be able to make the convincing argument that your client has title to the car in name only. If you can show that all the car payments were made by someone other than the person filing for bankruptcy and that this other person drove the car you may have a winning argument.

Moral of the story is: While you can certainly file for bankruptcy on your own, the question is do you really want to?!