Starting back in 2008, someone suggested that the bankruptcy forms could not be understood by the general public and needed to be updated, simplified and modernized. The Advisory Committee on Bankruptcy Rules took on the task and on December 1, 2015, the new forms went into effect. For more information on the forms and the changes, go to this website with a statement from the US Courts.
The forms come with instructions and have been streamlined and clarified (or simplified if you will) to allow non-attorneys to prepare their own paperwork. As an attorney, I always acknowledge that anyone can prepare their own bankruptcy case without the help or assistance of a bankruptcy attorney. However, I always throw out these two caveats. If you file for chapter 13 bankruptcy protection, I strongly urge you to hire an attorney. It is not the forms so much you have to worry about, rather it is the chapter 13 plan and the confirmation process that requires the knowledge and experience of an attorney. If you don’t understand the liquidation or the best interest test, you should probably be hiring a lawyer. The second caveat is that if you own a large number of assets or assets of great value, you should consult with an attorney about how best to position your case so that you are in not in jeopardy of losing your assets.
As a result of the form changes, I now add a third caveat. Even though the new forms are easier to read and understand, the information that a Debtor is required to provide, has not changed. A person filing for bankruptcy protection still has to disclose ALL assets and provide values of each; disclose ALL sources of income and accurately calculate income and expenses; and provide an accurate list of ALL creditors and who has to be noticed for each. If you own significant assets, have large income or expenses or have a number of litigious creditors, it will still be worth your time to consult with a bankruptcy attorney. This isn’t a try to get you to pay for our services, rather it is to serve as a warning that even though the forms may be easier to fill out, they still contain the same traps and pitfalls to the unknowing debtor.
There were a number of changes to the forms. As a bankruptcy attorney, the biggest change I see are stylistic ones. The forms have been redone to position like assets with like assets. Also, the questions are much clearer about the information that is required, instead of using highly legalistic words.
The most important change for me in my practice was the splitting of consumer and business cases. Actually, it is termed individual vs. non-individual cases. Now, for the first time, consumers (individuals) do not need to worry about understanding and answering the questions that were designed for purely business cases (non-individuals). By putting the pure business related questions and information on separate forms, it did make the forms a lot clearer and easier to understand
After doing this for 15 years, I am now faced with having to re-learn where all of this information has moved to. As mentioned above, the information, for the most part, has not changed. Just where you put it has. Also, there are additional questions for information disclosure that did not exist before. For example, now the debtor has to determine how a particular debt arose. Whether it was by agreement, by statute or by an involuntary action like a lawsuit and judgment, the Debtor now has to disclose, to the best of his knowledge what that information is.
The forms are cleaner. The questions are clearer. And the forms are more intelligently organized. But there is still a a multitude of information that must be gathered and processed to complete the bankruptcy paperwork. After doing this for 15 years, you can imagine if I am struggling with some of the new information, a debtor who is contemplating preparing the paperwork on his own may be facing even large comprehension problems. So as always, we don’t think going the down the bankruptcy road alone is a good idea. If you have a simple case, we won’t try and nickle and dime you. We promise we will charge you a very fair fee and make the process as unstressful as we can
If you have a large number of assets or some very valuable assets, we strongly urge you to consult with one of the bankruptcy attorneys in our office. We have over 30 years of experience, have handled thousands of cases and have hundreds of hours of continuing legal education to help you with almost any bankruptcy matter. One small mistake and you could put your valuable assets in jeopardy. We won’t let that happen. There are some things worth the time and expense and this is one of them.