Enter the petition drafter, who appears prepared to do the job. However, at what expense to the New York consumer seeking assistance?
The U.S. Bankruptcy Code provides a special set of rules governing what these individuals can and cannot do, as well as severe penalties for violations.
Before beginning our discussion, we must define precisely what a bankruptcy petition preparer is. In accordance with Section 110(a) of the United States Bankruptcy Code, a """"bankruptcy petition preparer"""" is anyone other than the debtor's attorney or an employee of the debtor's attorney working directly under the supervision of the debtor's attorney who prepares for compensation a document for filing in a United States bankruptcy court.
You immediately exclude your attorney and anyone who works for the attorney. However, you also exclude pro bono legal organizations and individuals who assist others without receiving payment for their services.
Section 110 is important because Congress recognized that non-attorneys who prepared bankruptcy petitions for consumers engaged in """"extensive fraud and unauthorized practice of law.""""
People who file a lawsuit in New York are frequently in a precarious position: they have no money, are terrified, and do not know how to get out of debt.
Congress enacted Section 110 of the Bankruptcy Code to address this issue. Section 110 requires petition preparers to perform specific actions, prohibits other behavior, and imposes penalties for those who violate the law.
The New York bankruptcy courts follow the general rule established in the Florida case of In re Landry, 268 B.R. 301 (Bankr. M.D. Fla.2001) that a bankruptcy petition preparer may meet with a prospective debtor, provide forms or questionnaires for the debtor to complete without assistance from the bankruptcy petition preparer, transcribe the information supplied by the prospective debtor on the applicable bankruptcy forms without change, correction, or alteration, and copy t he completed forms.
That is all. They cannot enhance the debtor's responses, advise the debtor on bankruptcy options, or provide any other legal assistance.
When you hire a petition preparer, all you get is someone who can type forms that appear nice.
What does this mean to you, a person with limited financial resources who is seeking assistance? You must recognize that a bankruptcy petition preparer cannot provide you with much assistance. They may type documents, but are not permitted to assist you with the law, exemptions, or anything else.
Once you recognize these limitations, the money you pay them hardly seems like a bargain, does it?
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