Filing bankruptcy alone can cost you more.

It’s not secret that legal services are often expensive, and when it comes to bankruptcy cases it’s also no secret that the laws are complicated and hard to grasp for the average citizen. You can save money by filing bankruptcy alone vs hiring an attorney, but you must remember that without representation it’s you and only you who’s responsible for the accuracy of your bankruptcy petition.

Since the laws changed over two years ago, it has become more difficult for filing bankruptcy yourself. It is now required for filers to take credit counseling courses before filing bankruptcy and also the income requirements have changed making it tougher to discharge all your debts, in some cases it is necessary to repay some of the debts under chapter 13 bankruptcy, depending on your yearly income.

The changes also made it more difficult for bankruptcy attorneys to determine eligibility and more paperwork now needs to be filed increasing the time and effort it takes to produce and accurate bankruptcy petition, therefore raising the overall costs of bankruptcy services across the country. Filing “pro se” (on your own), saves you the legal fees, however the risks you take by filing bankruptcy yourself are too great to spare the professional help.

The new provisions make it much easier to make mistakes if you are not throughly familiar with the new laws, so that if you file your case alone and are denied because of inaccuracies you may be penalized and may not be able to file again for some time. If you’re asking yourself “should I file bankruptcy alone?” consider first if you’re willing to take the time to learn the applicable laws and prepare your petition correctly. Knowing whether to file bankruptcy alone is as important as when to file bankruptcy.

The consequences of making mistakes can range from losing the “automatic stay” protection to getting your case dismissed, which can often result in losing property or other collateral possessions like a car, furniture etc. If you’ve got your mind made up or know what you’re doing then you can proceed with filing your own bankruptcy case, starting with the chapter 7 bankruptcy forms and chapter 13 bankruptcy forms, which you need to download.

Hiring a bankruptcy attorney

Courts frown upon having to process pro se filers since the denial rates are so high. When you have representation your chances of being denied minimize significantly. Why? That is what bankruptcy attorneys do and nothing else. This is a very specialized field of law and requires extensive knowledge of specific laws in the bankruptcy code. If you are willing to pay thousands of dollars for a root canal operation why would you not pay for representation on something that will effect your entire life?

When you file bankruptcy with legal representation, you can have piece of mind that your case will be handled properly. Bankruptcy forms include several pages for reporting income, assets, taking into account past tax years and overall debts that must be reported accurately to the court when your petition is filed. It is possible to fill out the paperwork on your own but the legal jargon on the forms often leaves the average citizen guessing.

When you do hire a bankruptcy attorney, you should always be selective in the process. Do they offer free bankruptcy evaluation to determine if filing bankruptcy is the most appropriate step for you to take to eliminate your debts? Your attorney should take the time to answer your questions and put you at ease, he should be compassionate and understanding of your situation. Find a bankruptcy attorney with experience in an established firm.

Some law offices charge a fee for giving you your initial consultation, but if you are strapped for cash then free consultations are a must. You do not want to pay for the initial consultation unless the lawyer you visit was highly recommended to you by someone you trust. There are too many law offices, however, that offer free bankruptcy consultations so don’t settle for the first office you call. Search for an experienced attorney, ask for a free consultation and learn the process. With legal representation you will stand the best chance of getting your petition prepared accurately and your case successfully processed.

News networks across the country have given considerable attention to the unprecedented number of bankruptcy filings throughout the nation. Once sprawling communities like Orange County California have some of the largest numbers of bankruptcy filings per capita. The real estate market in this area as in many parts of the country has come to a complete stop. No new development is taking place and the local economic outlook in Southern California as a whole is not improving mostly due to the price per gallon of gasoline, which is one of the highest in the country.

Souther California is one of the hardest hit regions in the country for personal bankruptcy filings, this is highly credited to the over valuation of real estate property during 2001 through 2005 and the sub-prime loans that funded the majority of these properties. The number of people filing for personal bankruptcy, compared to last year are up 90% for LA county, 125% for Riverside county and a staggering 150% for Orange County.

The state of Colorado has seen a rise of 35% since last year, and again it is home owners with high interest mortgage loans that make up over 60% of the bankruptcy cases.

Things are due to get worse according to economic experts, who predict no relief will be seen until two to three years from now. Because gas prices are gradually increasing each day, the cost of commodities and other consumer products have kept up with the price, adding further strain on the already heavily burdened communities of consumers across the country.

Overall the entire country is currently seeing a rise of 50% since last year. It is expected that by the end of 2008, we will see a total number of over one million personal bankruptcy cases which will continue throughout 2009.

Our economy is susceptible to many different factors, including external factors like the overall world economy. A contributor to the price of oil is none other than China. The country has emerged economically demanding more gas, food and quality of life. The once low waged workers are currently climbing the ladders economically and this new demand is now plugged to the main line of distribution for commodities like oil, wheat, and sugar.

It doesn’t matter how much money exists in any one region, it is the demand for these goods that drives up inflation.

So the economic state of the US, which is already affected by the real estate melt down, can expect to see higher prices for commodities and further escapes from debts through bankruptcy filings. Again no solid plan is in place to overcome this, any plan brought forth by the political parties are nothing more than pandering attempts.

Save what you can and invest in hard assets, paper assets will be worthless soon.

Your credit report, get it while it’s hot!

As you already know, your credit report is everything these days and you can’t do much without it. Once you file for bankruptcy, your credit rating goes out the window. This of course makes it very difficult for you to get credit again, apply for loans, rent property etc. One thing you can do prior to filing your bankruptcy petition is to get a copy of your credit report from the three credit bureaus while it’s still in good standing.

You’ll find quickly that after bankruptcy things get more complicated, but there will be times when you might encounter a company or someone who may be willing to work with you despite your current credit score. When someone is considering approving you but needs some convincing, your previous credit history could be the key to closing the deal. Of course this is not going to apply to everyone, since some people have bad credit all their lives and most creditors will simply not care how good your credit was before you filed. So these are special circumstances in which it’s important that you actually had good credit with a good score prior to filing bankruptcy, it can give you some leverage in certain negotiations.

With the current state of the mortgage market and the number of foreclosures and bankruptcy cases around the country, many people are losing their homes and in some cases voluntarily surrendering their homes to their lenders after filing bankruptcy chapter 7. Whether you willingly surrender your property or it is foreclosed by your lender, you’re going to need to live somewhere, and having a copy of your credit report prior to filing could make a difference.

Another thing to keep in mind when you go looking for a place after you leave your home is to try and stick to places that are being rented by individual owners. Apartment complexes are going to have management companies who often require the typical procedures for renting, which are a credit check, references, rent history and a long application and normally frown when they see consumer bankruptcy entries on credit reports.

Renting from a property owner who manages their own property could be a better option since they’re usually more motivated to keep their places rented. Just be honest about your bad credit and bankruptcy case when you approach them. You may find that they can be more understanding and sympathetic than a management company. Often these real estate investors will hire management companies to do this for them. These are usually smaller companies that work hard to keep a high level of occupancy and can be very flexible, you just need to ask.

If you don’t have much choice when you start looking for a place, and decide to stick to the apartment complex settings, look for places that show move-in specials like 1st month free, or 1/2 month rent for 2 months etc. These incentives are a sign that these properties have more vacancies than they’d like, so when you apply they may be willing to overlook your bad credit and bankruptcy record, and once again if you can prove to them that prior to filing bankruptcy or your foreclosure your credit was good, it’ll give them more confidence in renting to you.

Obviously once you get approved you don’t want to mess it all up by being late or missing payments. This will work against you in so many ways, since now you’re in fact working towards rebuilding your credit, so getting positive entries and good referrals are the things that you should be striving for. The last tip for making your new landlord happy is to offer to pay them rent via direct deposit, this can really increase your chances of getting approved and of course you’re creating a great referral.

Are we already in a recession? I have been reading up on this subject and found different opinions on the recession issue. Many still think that we’re not, because technology companies like Google and Facebook seem to be hiring at a steady pace, while startup companies are still being funded, so these would be signs that things are going well or at least that there’s an upbeat attitude over all.

I’m not a doom and gloom kind of guy and I hate to be right when it comes to negative predictions, which I don’t often make. But we don’t revolve around a partially good economy, the housing crisis and sub prime lending mess are already here and they are costing millions everyday in defaulted loans. Bankruptcy cases are climbing and people are losing their homes and ruining their financial lives. I really do wonder what is going to happen with all those homes left behind when there’s no more demand.

So my findings tell me that while many economic experts believe we’re not in a recession, no one is denying that growth has slowed down everywhere and that to me signifies that a recession has started. Officially the National Bureau of Economic Research (NBER) will declare a recession when we’re half way through it. I fail to see the sense in that.

The only growth I seem to have any control over is my savings account and maybe my 401k if I keep up with it and make necessary changes when market conditions begin to move downward. I think we’re all thinking about the same thing right about now, which is “what’s going to happen in the next year?” Will we be in full recession and what will the Fed’s plan be to get us out of it. Will it be another drop in interest rates to encourage borrowing and spending again? I’m dying to know where we’re headed.

Till then all we can do to gain some protection is to adhere to more conservative spending. Only spend on true necessities and stash away the rest of your available cash, looks like it may turn out to be a tough winter. Many people will argue that this is bad for the economy, but does continuing to spend money really extend as something that’s collectively good for all? Do I really need to buy just to buy as long as it’s good for the economy? Seems very unfair to put that responsibility on consumers in a time like this.

Personal bankruptcy cases are on the rise. Hundreds of thousands of Americans declared bankruptcy in 2007 and the rate of filing has not slowed down in 2008. A tough economic state and lack of stable employment and job security are only part of the reason. Personal spending habits have certainly contributed to record levels of credit card debt and the current housing market has left many with high balance loans and depreciating values in many parts of the country.

Filing for personal bankruptcy is a tough decision and whatever the circumstances may be for you, it’s important that you educate yourself as much as you can and carefully assess your own financial situation before you proceed with filing bankruptcy. There are several types of bankruptcy that cover not only individuals but small and large businesses and of course special codes for corporations. Chapter 7 and Chapter 13 are the two types of personal bankruptcy and the most commonly filed, Chapter 11 is similar to chapter 13 though this is what an LLC, partnership or corporation would want to file.

This is a quick explanation of what filing bankruptcy is all about, what it does and the effects it can have on your financial future. Please check out the links above for detailed explanations on bankruptcy chapter 7, chapter 13 and chapter 11.

Please take note that none of content here is meant as legal advice nor is it intended to encourage anyone to file for bankruptcy. This option should be a last resort, there are alternatives to bankruptcy that you should consider before filing.

What is bankruptcy?

Bankruptcy is a legal proceeding in which people, companies or corporate entities who can no longer afford to pay their creditors, can get protection through a court order called “The Order of Relief”. Bankruptcy offers a fresh financial start and these benefits are afforded to all by federal law, therefore all bankruptcy cases are handled in federal courts. Bankruptcy puts into effect the order of relief also known as the automatic stay which stops your creditors from attempting to collect payments from you, that is until your debts are sorted out through court proceedings. The automatic stay is further explained in the Chapter 7 page.

During the process of filing bankruptcy you will need to provide specific documentation such as past tax returns, proof of income, a breakdown of all your debts, all property and assets you own, etc. It is possible to file your bankruptcy case alone but the paperwork is complicated and can be confusing. Hiring a law firm that specializes in personal bankruptcy cases is usually the best thing to do. These services aren’t always cheap though, and if you’re struggling to pay your creditors you may have trouble paying the fees for these services, which often need to be paid up front. So it’s important you prepare in advance and allocate some funds early on when you begin to consider filing bankruptcy.

There are a few chapters in the US bankruptcy code. Chapters 7, 9, 11, 12, 13, and 15. You will get a detailed explanation of chapters 7, chapter 11 and chapter 13 on this site since they are the most common forms for individuals, partnerships and small businesses. It’s easier for a bankruptcy attorney to determine which bankruptcy chapter you qualify to file, however by learning about what each chapter does and how they work you will get a good idea for which one will fit you best. Here’s some of the information you’ll need to provide before you file:

What happens after bankruptcy?

Neither one of these chapters will make it easier on your credit once you get a bankruptcy discharge. The difficulties after bankruptcy obtaining credit, renting a place to live, and qualifying for certain jobs will be the same. Unfortunately the fresh financial start can be hard to embrace when you file bankruptcy since it takes time to rebuild you financial life again. The hardships can continue if you do not prepare to file bankruptcy in advance. Normally after bankruptcy, most credit providers will not want to deal with you. The ones who will, can impose high interest rates and/or high security deposits because of your recent bankruptcy case.

When you file you will be required to take bankruptcy counseling courses, also known as credit counseling, from an agency approved by the US Trustee . You can find a list of approved agencies at this link: US Trustee Approved Credit Counseling Agencies. The costs are usually moderate, $20 to $30 dollars should be a good range to stick to. You will need to take the first part of this personal bankruptcy training before filing and then the second part before you get discharged.

Consider your case carefully and don’t forget that there are bankruptcy alternatives that depending on your situation may be feasible options to consider before going through with filing your case.