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Judge Limits BPP Fees to $200


On May 15, 2012, a Colorado bankruptcy judge ruled that it is "presumptively unreasonable" for a bankruptcy petition preparer (BPP) to charge more than $200 total for a chapter 7. The court said that the BPP should have charged no more than $150 in that case and ordered the BPP to give up her $499 fee. The court also awarded the BPP's client $2,000 and fined the BPP $2,000 for violations committed by the document preparer.1

Denver bankruptcy attorney Robin Kert Hunt can assist you with legal advice, pre-bankruptcy planning, and representation. Unlike a BPP, I am allowed by law to provide pre-bankruptcy planning, to help you keep your home, car and other property, and to minimize what you can lose in a bankruptcy.2

Bankruptcy case administration is supervised by the U.S. Trustee Program, which has this to say about what BPPs can and cannot do:
Non-attorney bankruptcy petition preparers may type bankruptcy documents with information supplied by the debtor. They may not provide legal services, such as helping you choose whether to file under chapter 7 or chapter 13 or identifying your property that is exempt from the reach of creditors. Bankruptcy petition preparers may advertise their services under "document preparation services" and similar categories of services, but not under "legal services." If a bankruptcy petition preparer offers to provide legal services to you or fails to disclose that he or she is not an attorney and may not provide legal services, please report this to a U.S. Trustee Program field office.

If your bankruptcy forms are simple enough to be typed up by a BPP, you may be eligible for pro bono or basic chapter 7 bankruptcy assistance. For eligible individuals, I offer a pro bono chapter 7 bankruptcy with total attorney's fees and costs as low as $430. Pro bono fee eligibility is based primarily on (a) household income less than 150-200% of Federal Poverty Guidelines and (b) assets with values that do not significantly exceed exempt amounts.3  

Since 1986, I have been helping Colorado individuals and small businesses with debt relief under chapter 7 and chapter 13 of the Bankruptcy Code. I offer a telephone interview without an upfront charge to a prospective client. Because I have been practicing bankruptcy law for more than 26 years, I know what questions to ask, and I may be able to give you a pretty good idea of the fees involved for the work necessary for your "fresh start."

If you hire me for bankruptcy help, you will benefit from my empathy, experience and expertise. Call me if you are genuinely interested in bankruptcy assistance from my law firm. If I am not available, leave a message, and I'll call you.


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1  If you seek help from a bankruptcy petition preparer or from an attorney, find out the full cost upfront before making any down payment. There is absolutely no reason to pay a bankruptcy petition preparer more than $200. If a BPP wants to charge more or to include add-ons, don't be afraid to ask why the BPP is charging more than Judge Brown allows in the Cordova order (below). Maybe there is a reason why you should consider retaining an attorney. Let the bankruptcy trustee know if you think that a BPP has tried to rip you off or isn't following the rules.

2  Section 110(e) of the Bankruptcy Code, titled "Penalty for persons who negligently or fraudulently prepare bankruptcy petitions," prohibits a BPP from providing any legal advice, including the following:

(1) whether
(a) to file a bankruptcy petition; or
(b) filing a case under chapter 7, 11, 12, or 13 of the Bankruptcy Code is appropriate;
(2) whether debts will be discharged in a bankruptcy case;
(3) whether a debtor will be able to retain the debtor's home, car, or other property after filing a bankruptcy case;
(4) concerning
(a) the tax consequences of a bankruptcy case; or
(b) the dischargeability of tax claims;
(5) whether a debtor may or should promise to repay debts to a creditor or enter into a reaffirmation agreement with a creditor to reaffirm a debt;
(6) concerning how to characterize the nature of the debtor's interests in property or the debtor's debts; or
(7) concerning bankruptcy procedures and rights.

It is also illegal for a BPP to "use the word 'legal' or any similar term in any advertisements, or advertise under any category that includes the word 'legal' or any similar term." Section 110(f). If you seek help from a BPP, make sure the BPP knows the rules and follows the law. After all, it's you and your case on the line.

3
  The pro bono chapter 7 bankruptcy is similar to what is available through Colorado Legal Services from Metro Volunteer Lawyers.

Find out more about me at these law-related web sites:  Avvo.comJustia.comNolo.com, and Colorado Supreme Court.