If you are a bankruptcy attorney looking for help with petition drafting, there is a good chance you have typed "bankruptcy petition preparer" into a search box. It is the phrase most people know. But it describes a specific role under federal law, and it is not quite the arrangement most law firms are looking for.
What the law means by a bankruptcy petition preparer
Section 110 of the Bankruptcy Code defines a bankruptcy petition preparer (BPP) as a person, other than an attorney or an attorney's employee working under the attorney's direct supervision, who prepares bankruptcy documents for compensation. In practice, a BPP works directly for a person who is filing without a lawyer.
Section 110 puts several obligations on that preparer. In general terms, the preparer must sign the documents they prepare, put their name and identifying information on them, and disclose to the court what they were paid. They may not give legal advice. Many states also limit what a non-attorney may charge for preparing legal documents.
What a Virtual Bankruptcy Assistant does instead
A Virtual Bankruptcy Assistant (VBA) does very similar drafting work, but the working relationship is different. A VBA works for a bankruptcy attorney. The client is your client. The VBA drafts the petition; you review it, ask for changes, approve it and file it, and you make every legal decision in the case.
That is why NAVBA only advocates working under the direction of a licensed attorney. The terms "VBA," "bankruptcy petition specialist" and "bankruptcy petition preparer" are often used interchangeably in everyday conversation, but the question that matters is simple: who does the drafter answer to?
Why the difference matters to your firm
- Legal advice has somewhere to go. A debtor will ask which chapter to file or which exemption protects the house. A VBA routes that question to you. Someone preparing a petition directly for a debtor has nobody to refer it to.
- The decisions stay yours. Bankruptcy software often auto-selects exemptions. It can be a reasonable default and still not the best choice under your local rules. With a VBA, the selection is submitted to you for review, so it becomes your decision.
- Your signature still carries weight. When you sign a petition, you are responsible for the reasonable inquiry that goes with it. Working with an assistant does not change that, which is one more reason to keep the arrangement under your supervision.
Is a VBA the right fit for your practice?
If you want capacity without hiring, a VBA is usually what you actually need. You are buying a service rather than adding staff, so there is no payroll, no benefits and no workspace to provide, and you pay for the work you send. Many VBAs also handle due diligence research, e-filing, 341 meeting notices, amendments and routine pleadings.
If you really are looking for someone to help an unrepresented debtor, that is a different arrangement, and it is not one NAVBA advocates. One caution: how Section 110 applies to an outside contractor who drafts for your firm can depend on how the arrangement is structured and on your court's local rules, so check with your own counsel or your court if you are unsure.
How to find one
The NAVBA directory lists Virtual Bankruptcy Assistants you can search by state and specialty and contact directly. There is no fee to use it, and NAVBA does not take a cut. If you would rather describe what you need, you can request a VBA and we will point you to members who are accepting work. For a fuller picture of how hiring works, see how to hire a Virtual Bankruptcy Assistant.
This article is general information about bankruptcy practice, not legal advice. Local rules, trustee preferences and state law vary, so confirm current requirements for your jurisdiction.
