Personal Bankruptcy

Faced with mounting debt consumers search for a way out. Personal bankruptcy is the best solution for some, but others are better off working out their debts with their lenders, or even taking no action at all. There is no one size fits all solution. The best solution for each family and each individual depends on the specific circumstances – including the debtor's age, type of debt, income, and assets.

There are two types of personal bankruptcy -- Chapter 7, and Chapter 13. Chapter 7 is liquidation bankruptcy in which a consumer can liquidate and discharge certain debts. The outcome is that the consumer no longer owes the discharged debts at all. In Chapter 13 the debtor sets up a payment plan to repay their debts within a certain time period.

U.S. Bankruptcy Code

Article I, Section 8, of the United States Constitution authorizes Congress to enact "uniform Laws on the subject of Bankruptcies." Under this grant of authority, Congress enacted the "Bankruptcy Code" in 1978. The Bankruptcy Code, which is codified as title 11 of the United States Code, has been amended several times since its enactment, most recently modified in 2005. It is the uniform federal law that governs all bankruptcy cases.

The procedural aspects of the bankruptcy process are governed by the Federal Rules of Bankruptcy Procedure (often called the "Bankruptcy Rules") and local rules of each bankruptcy court. The Bankruptcy Rules contain a set of official forms for use in bankruptcy cases. The Bankruptcy Code and Bankruptcy Rules (and local rules) set forth the formal legal procedures for dealing with the debt problems of individuals.

Bankruptcy Petition Preparers

More and more people are seeking help from non-lawyer bankruptcy petition preparers (BPPs). These are non-lawyer typing services or individuals that charge a fee to generate bankruptcy forms, under the strict direction and control of the consumer. It is important for all parties to remember that bankruptcy petition preparers are not lawyers and cannot provide any legal advice.

In Florida the fees that a BPP may charge a consumer to prepare bankruptcy documents are regulated by the court. The fees are less than $200. and vary slightly depending on which Florida District you're filing in.

A bankruptcy petition preparer is by definition any person or business, other than a lawyer or someone who works for a lawyer, that charges a fee to prepare bankruptcy documents. A bankruptcy petition preparer generates bankruptcy forms to file either by typing them or inputting information into a bankruptcy software program.

A Bankruptcy Preparer May Not:

The consumer must understand which debts bankruptcy will discharge, what will happen to his/ her property in the bankruptcy, and what laws should be used to exempt property from being taken for the benefit of creditors. In addition, the consumer must file the bankruptcy papers himself and represent himself in court.

Many of our members prepare bankruptcy petitions prepare bankruptcy petitions for consumers. If you need help please contact one of our members or call us at 800-515-0496, and we'll try to match you with a bankruptcy petition preparer in your area.

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