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Ask WALLSTREETESQ Your Own Question
Category: Bankruptcy Law
Satisfied Customers: 17252
Experience:  14 years exp., CH 7 AND 13 Bankruptcy cases, AFL-CIO UNION PLUS, UFT NYSID AND ALL MAJOR UNIONS
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I am a consultant and I assist homeowners in foreclosure prevention. Our

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I am a consultant and I assist homeowners in foreclosure prevention.
Our office is in Ca and we charged a client $2500 for foreclosure prevention and $1500 for debt management
Advised client to file a bk and they choose to do it pro per. My office retained a paralegal office to complete this. On Bk petition fees that my office charged was not disclosed.

Now attorney for the bk court is requesting that we refund $2500 and $1500 plus $8000 in damages. Can they ask for the $2500 be refunded for foreclosure prevention?

Also can the paralegal be prevented to continue doing paralegal service for not disclosing bk fees charged?


Hello I am a licensed attorney here to help you with your question, please review my response and do not hesitate to ask for clarificati on


This has become a common issue,


in terms of a paralegal performing bankruptcy petitions, that is allowed only if they follow the strict rules of document preparers, and they are limited by law in what they can charge,


In terms of your fees, you will have to show what you did for the fees charged,


if your only service was to counsel the person to file a bankruptcy, that would not allow you to keep the fee, if you actually performed work on behalf of the client, you need to prove this,


and show the court what you did for the fee,


bankruptcy law does require bankruptcy petition preparers to follow certain business practices. Among other things, bankruptcy petition preparers must:

  • provide a written contract defining their services and fees

  • provide written disclosures summarizing the different kinds of bankruptcy and the associated procedures

  • identify themselves (in their marketing materials) as debt relief agencies providing services under the federal bankruptcy code

  • not charge an unreasonable fee (fees generally range from $100 to $200)

  • not collect or handle the bankruptcy filing fees or other court fees (you must do that yourself)

  • file a fee disclosure statement with the court (stating how much they have charged you for services)

  • include their name and social security or tax identification number on the documents they prepare, and

  • not use, or advertise with, the word "legal" or any similar term.


Section 110(h)(2) of the Bankruptcy Code (title 11 of the United States Code)
provides in part:
A declaration under penalty of perjury by the bankruptcy petition preparer
shall be filed together with the petition disclosing any fee received from or
on behalf of the debtor within 12 months immediately prior to the filing of
the case, and any unpaid fee charged to the debtor. . . .
2. Section 110(h)(2) does not give the court authority to extend the time for filing
the disclosure.
3. Form B280 was issued by the Director of the Administrative Office for petition
preparers to use to make the disclosures required by section 110(h)(2) the Code.
4. The purpose of the reporting requirement for bankruptcy petition preparers is to
permit the court to determine whether the compensation exceeds the reasonable
value of the services rendered. Section 110(h)(3) states:
(A) The court shall disallow and order the immediate turnover to the
bankruptcy trustee any fee referred to in paragraph (2) found to be in
excess of the value of any services –
(i) rendered by the bankruptcy petition preparer during the 12-
month period immediately preceding the date of the filing of the
petition . . .
(B) All fees charged by a bankruptcy petition preparer may be forfeited in
any case in which the bankruptcy petition preparer fails to comply with
this subsection or subsection (b), (c), (d), (e), (f), or (g).

Customer: replied 4 years ago.

I charged $1500 for bk petition and gave her $200 and $306 to court fee

Can court sanction her and prevent her from practicing paralegal services from not disclosing that she collected the $200?

yes, disclosure is required under Federal law that I cited above, and the trustee may also find the $1500 paid to you for the bankruptcy is unfair and a violation if federal law. Also, be aware at this point you will need to hire a good bankruptcy lawyer to defend you.

Please see the list of recent cases, at the link below:
Customer: replied 4 years ago.

how do I locate a bk attorney

should I choose one that practices in the county?

You can go online for a bankruptcy attorney, I would also contact the bar association, you need to object to the trustees motion soon, and have to justify your actual services.
Customer: replied 4 years ago.

what should I inquire with the bar


can I retain you to respond to the motion

You should ask the local bar association, for a bankruptcy attorney, they will provide you a list,

We cannot represent customers, but we can answer questions if needed.
Customer: replied 4 years ago.

great thanks

I appreciate it

good luck, and if satisfied please provide us with positive feedback.
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