Horror Story of Doing Your Own Bankruptcy

Pro se means that you are doing your bankruptcy yourself. Pro se means that to some degree you are gambling. I love gambling and I think that it is among the plethora of things that an adult ought to be able to do, but gambling is all a matter of degree.

If your trust fund is so big that you could not spend all the money if you had to, where money is just paper to you, a $100.00 bet is nothing. If that $100.00 is the last $100.00 that you have, that is something else indeed.

If you buy a lottery ticket and enjoy looking up your number to see how badly you lost, you are gambling $1.00 on winning a fortune, but you stand to lose at all times ONE DOLLAR. There is a saying that the lottery is God’s way of punishing those who are not good at math. Like lots of humor, there is no doubt some truth in that.

If you go to Cripple Creek or Las Vegas and put all the money that you have ever made on one roulette wheel spin, that is a whole different level of RISK. You do not stand to lose a dollar; you stand to lose a large part of your life.

Filing your own bankruptcy may involve a HUGE amount of risk. YOU MAY OR MAY NOT BE ABLE TO CORRECT YOUR MISTAKE. REMEMBER that last sentence. You are not always entitled to a redo. Ugh oh.

I am not into FEAR. I am into TRUTH. The truth is that if you file a bankruptcy and you have done things wrong, your assets can be at risk. You can lose and lose big time. For what? Are we talking saving $1000 in attorney fees to gamble your home, car, boat, annuity, whatever?

Ok here is the HORROR story. Not long ago I talked to a bankruptcy trustee who had just had a case where a debtor did his own bankruptcy and the debtor had thought he was very CLEVER. ( I am talking here about a Chapter 7 case. If you do a pro se Chapter 13 case, all of the judges, attorneys, and court personnel will look at you like you are passengers on the Titanic who have just strapped on their seat belts as they yell “We are just going to ride this one out”). Anyway, CLEVER in the bankruptcy world to me means a person suddenly has a bright idea that he has figured out the bankruptcy system and he can thus GET OVER on the system.

You have to remember that bankruptcy is a system where bankruptcy professionals spend their entire working lives trying to understand how this system works. Some CLEVER types decide that their one trip down bankruptcy lane can be done easily and without a horror story attached. MAYBE.

One of the cool things about being an attorney is that you can look into the backyards of many different types of people and can find out some really interesting stuff. A couple of police clients have told me that a weird aspect of meth usage is that the meth addict feels that they are just a little smarter than everyone else. Sure he gets the euphoria, the la la land effect that many drugs produce, but apparently a unique effect of this drug is that he also feels a bit more CLEVER than anyone else; everyone else is in slow motion. The client cops tell me that the meth guy when busted is sometimes flabbergasted that the cops figured out that he was doing meth. He was so CLEVER. The cops are like “DUH, your neighbors say that you are the only one on the block who stays up 24 hours a day for weeks at a time” DUH.

The public service part of this diatribe is that It goes without saying that you should never gamble or do bankruptcy on meth, but I digress.

Ok, so the clever debtor who ran into the bankruptcy trustee lately had the trustee talking about FRAUD, LOSS of an asset worth more than $50,000, and getting the FBI involved. And the pro se debtor saved $1,000.00.

The bankruptcy trustee was mad. He was mad and it took me a couple of minutes to figure out why he was mad.

You have to understand how a Chapter 7 bankruptcy trustee makes his living. He receives $60.00 for each case initially. Most attorneys these days charge somewhere around $200 to $300 per hour.The amount of time that a trustee puts into a case we can easily assume makes him lose money if that is all he gets. That is why the Chapter 7 trustee is given an incentive. He gets a percentage of all the assets that he can bring in for the creditors, and he gets the assets from YOU. He takes whatever non-exempt property, real estate, vehicles, boats, whatever, that you may put into jeopardy by your mistakes. Whoops. So, a perfectly safe situation can be turned into a HORROR story by YOU.

The bankruptcy trustee in this case will I believe make money because the debtor will most likely lose a large asset. The trustee was mad because this debtor parachuted into the bankruptcy arena thinking he was smarter than anyone else and he has now forced the trustee to HURT him. The trustee’s job is to get assets for the creditors. It is his JOB. He must do it and he will profit from it. But he is also human and feels bad for this CLEVER debtor.

I am not going to tell you exactly what this debtor did for a couple of reasons. One is that I have done this work for more than 30 years and I need to get paid for my expertise or I cannot afford to help anyone. The second is that if you take a scatological approach to filing your bankruptcy pro se, gathering information here and there on the internet and stealing advice from attorneys in free consultations, you will get a SCATOLOGICAL BANKRUPTCY. It is much easier to take all of your money, put it on red, and spin the wheel.

As Shakespeare may have put it, if you file your own bankruptcy you can find yourself “Hoisted by your own petard”. In the vernacular, you may totally screw yourself. Some of us do not need enemies.

Are you clever? Babies put a finger in front of their face and think that they are hiding. Like the meth addict situation, no on else thinks they are hiding. You could of course try the opposite of the approach I mentioned above: just take all your money, put it on blue this time, and spin the wheel.

Seriously, most attorneys would sacrifice their grandmothers if it would help their client. Find someone who has been to many, many bankruptcy rodeos, who knows where most of the bodies are buried and who you trust to help you. We are available.