What Does a Petition Preparer Do?

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Any individual hired to type and prepare documentation and paperwork on behalf of a debtor who has filed for bankruptcy is called a petition preparer. These professionals are not lawyers or attorneys and are simply meant to help you with your bankruptcy forms (and make the complicated process simpler). The direction and terms of your petition are still under your control and choice. The petition preparer receives certain compensation in return for his duties, the limits of which are set by the United States Supreme Court or the U.S. Judicial Conference in its guidelines.

Limitations of a Bankruptcy Petition Preparer

A petition preparer is prohibited from doing the following:

  • Mentioning the term “legal” or any related term in any advertisement
  • Giving any legal advice or representing anyone in bankruptcy court

The advice which he is prohibited to give include:

  • Whether to file a case under bankruptcy court
  • Under which chapter of the Bankruptcy Code the petition is to be filed
  • Whether the debtor’s property shall be retrieved under this case
  • If the debtor should/may promise the creditor regarding any repayments or enter into any reaffirmation agreements with him
  • Whether to stay away from or completely remove any liens or try to gain back assets involved in the current case
  • The tax consequences of any bankruptcy case
  • How to respond to the bankruptcy forms in relation to the filing of the particular bankruptcy case
  • What exemptions can be claimed

Any professional who prepares petitions for bankruptcy cases is not liable to collect any court fees or execute any document on behalf of the debtor.

Why Use a Bankruptcy Petition Preparer?

A good bankruptcy petition preparer can be of immense help if one does not have access to a computer and is vague about the idea of the right kind of bankruptcy form or document. For this, a petition preparer should be updated regarding the latest software that can generate the required bankruptcy forms and documents with ease and speed.

Most bankruptcy petition preparers charge lower fees than lawyers. Apart from this, a bankruptcy petition preparer should identify themselves correctly and should properly summarize their services and fees in a contract. They should also include their social security or tax identification number in their identity, which should be mentioned in the documents they prepare.

Importance of a Lawyer

Petition preparer should only be employed only if your bankruptcy attorney has advised you to do so. Though you might be under tremendous financial strain, you should not let a petition preparer advice you on bankruptcy. Only a qualified legal professional is entitled to do that.