A bankruptcy filing can be legally complicated, as well as time-intensive. In many cases, your first big decision and major time commitment will be finding a bankruptcy lawyer. While you may already have an attorney from your business, estate planning, or family matters, they might not be experienced in bankruptcy. More often, you will have to find an attorney from scratch. This can be well worth the effort because lawyers who practice exclusively in bankruptcy tends to do it quickly and cheaply.
Using a Bankruptcy Attorney
It may feel counterintuitive to pay attorney’s fees for help with your financial crisis. But professional assistance can mean the difference between a setback and a total loss when you have serious debt issues. You can have a free consultation with most bankruptcy attorneys to explain your situation and see if your personalities are a good fit. There is no legal obligation to have an attorney when you go into bankruptcy. However, bankruptcy law is a complicated and ever-changing system. Having knowledgeable assistance is a practical necessity.
An experienced bankruptcy attorney can help you:
• Preserve valuable assets and explain your state-specific exemptions
• Possibly avoid bankruptcy altogether
• Reduce future negative outcomes and impacts of a bankruptcy action
• Avoid pitfalls and common mistakes
• Exercise your rights when applicable
• Create a fair payment plan for debt
• Explain options for informal debt relief actions
• Communicate with your creditors
• Establish a debt “workout” agreement
• File paperwork for Chapter 7 and Chapter 13 bankruptcy processes
• Ensure you pay the correct filing fees
• Discuss foreclosure and future credit report options
• Tell you what to expect in bankruptcy court and bankruptcy trustee appointments
• Discuss buying a home after bankruptcy
• Pursue your legal rights and protect your interests zealously
Having a bankruptcy attorney is increasingly important. In 2005, Congress passed the Bankruptcy Abuse Prevention and Consumer Protection Act. Among other changes, this law modified existing bankruptcy procedures. It shifted responsibility for providing documentation and proving your inability to pay debts to the bankruptcy debtor (you).
Choosing Your Attorney
You will want to meet with any attorney you consider hiring to see if you and the attorney can work together in general. You will really be interviewing the attorney just like you would interview a job applicant. Some bankruptcy attorneys run their offices like an assembly line, which is not necessarily bad. It means they won’t be wasting your time either. You need to decide whether the style of any given attorney is one with which you can work. Select the attorney with experience and an approach that fits well with you.
Questions Your Lawyer Will Ask About Bankruptcy
To do the best possible job on your behalf, your attorney needs your input and cooperation. At your first meeting with your attorney, you should be prepared to provide the following information and answer important questions. If you are filing with a spouse, be ready to share their information as well.
• Will this be a joint bankruptcy petition?
• What county do you live in?
• How long have you lived at this address?
• List previous addresses in the last two years
• What is your Social Security number?
• List all banks with which you have an account, and indicate whether they are checking or savings and the approximate balance
• List all credit cards you have and the approximate balance
• Do you have any shared bank accounts?
• Have you had a safe deposit box in the last two years? (If yes, note the location and the contents of the safe deposit box)
• Are you holding valuable property that belongs to another person?
• Have you had a prior bankruptcy? (provide the case number, date filed, debts dismissed, and outcome)
• Is any of your property in the hands of a receiver, trustee, or another liquidating agent?
• Are you suing anyone right now?
• Have you been involved in a workers’ compensation or personal injury lawsuit where you expect to recover money?
• Have you had any repossessions in your past history?
• Have you suffered any losses by fire, theft, or gambling during the last year?
• Are you single, married, or divorced? How long (if married or divorced)?
• Have you used any other name(s) in the last six years?
• What are the names and ages of minor children living with you?
• What amount of child support or spousal support (alimony) do you pay?
• Do you owe any money to the Internal Revenue Service? Which tax years?
• Do you owe any money to state tax authorities?
• Do you have any unpaid student loans?
• Do you anticipate a substantial change in your expenses in the immediate future?
• List the years in which your debt was incurred
• Provide estimates for all monthly expenses:
• Rent, mortgage, and real estate taxes
• Electric, gas, trash, and water
• Home maintenance
• Life insurance and health insurance
• Phone, cable, and internet bills
• Auto insurance, gas, or car expenses
• Homeowner/renter insurance
• Medical bills or items
• Clothing budget and laundry
• Who is your current employer?
• How long have you been at your current job?
• How often are you paid?
• What is your income per pay period (gross and net income)?
• Have you received income from any other source than your job last year (for instance, Social Security, child support, workers’ compensation, etc.)?
• What amount of income have you made at your job in the past two years?
• If you have more than one job, list year-to-date and two-years prior income information.
• What amount of income have you received from other sources in the last two years?
• Will you be eligible for a tax refund this year? How much?
• Have you been in a partnership with anyone during the last six years?
• Have you been an officer in a corporation within the last six years? (If yes, give the name of the business and/or corporation, dates of operation, nature of business/corporation, and your approximate yearly income from the business.)
• Have you given away, sold, or transferred any valuable item (over $1,000) in the last year? (If yes, state the nature of the sale or transfer, what was transferred, the price, and when it occurred.)
Documents Your Bankruptcy Attorney Needs
Once you hire an attorney to assist with your bankruptcy case, it is important to provide the information they need to best advice and represent you. Although every person’s financial life is different, some basic documents are virtually always helpful in better understanding your financial position.
Examples of important documents include, but are not limited to:
• Bank statements
• Your most recent bill from each creditor
• A record of your most recent payments on cars, real estate, and student loans
• Bills or invoices for purchases in the past year
• Files from previous litigation, including judgments
• Files from previous attorneys
• Divorce decrees, child support orders, and information about other financial obligations
• Canceled checks for any undocumented expenses
• Mail or email correspondence with creditors
• Insurance policies
• Tax returns for the past three years
• Vehicle titles
• Lease or mortgage documents
• Promissory notes
• Proof of any other debts you owe or money owed to you
Bankruptcy cases can involve multiple people and creditors and take years of litigation. It can be a personal comfort to have someone who understands the system and is on your side.
Benefits of Hiring a Bankruptcy Lawyer
1. Hiring a lawyer increases your chances of successfully eliminating debt. In the case of Chapter 13 Bankruptcy, debtors represented by a lawyer are more than ten times more likely to reach a successful outcome than individuals representing themselves.
2. A lawyer can help you decide if bankruptcy is the right option for you. It is essential to evaluate and understand all of the options available to you when you are facing overwhelming debt. While it may seem like bankruptcy is your only choice, a lawyer may have a better solution for managing your debt without declaring bankruptcy.
3. You don’t know which bankruptcy option is best for your situation. An experienced bankruptcy lawyer will review your financial situation and explain your bankruptcy options. In Wisconsin, the two most common types of personal bankruptcy are a Chapter 7 Bankruptcy and a Chapter 13 Bankruptcy. Your state lawyers can help you identify which type best fits your current situation and guide you through the entire process.
4. A bankruptcy lawyer will help eliminate all eligible debts. A bankruptcy lawyer will know which debts can be discharged and the best type of bankruptcy to use to discharge your debt. For example, a lawyer can identify and eliminate debts beyond the statute of limitations for collections. You will also save money by fully discharging your obligations and not having lingering debts after completing your bankruptcy.
5. Experience is crucial to success. Do you know the Utah Bankruptcy Code? Do you know Utah District Courts’ bankruptcy laws? Do you know what property is exempt from bankruptcy? Filing for bankruptcy requires knowledge of the federal code and local case law. An experienced bankruptcy lawyer has worked on hundreds of cases and understands the intricate details of the process. A bankruptcy lawyer will be familiar with current laws, courtroom procedures, the bankruptcy filing process, and filing timeframes.
6. Hiring a lawyer saves you time. Hiring a lawyer saves you countless hours, as you no longer have to spend your time researching and reviewing bankruptcy information. In some cases, a lawyer can identify shortcuts and smooth out the scheduling process. A bankruptcy lawyer in your area will guide you through the complicated procedures and keep you informed at every stage.
7. You don’t have to handle the paperwork. Filing for bankruptcy requires accurate, detailed, and timely paperwork. It is crucial to have precise information and sufficient supporting documentation. While much of the information will come from you, a lawyer can help you complete the paperwork and provide legal advice on your disclosures, valuing assets, income, and expenses.
8. Lawyers have an established relationship with the bankruptcy court, judges, and trustees. A bankruptcy lawyer has gone through this before; they are familiar with bankruptcy courtroom etiquette. Lawyers have already built relationships with the people involved in the process, making communication easier for you. When the trustee asks for additional information or details, your bankruptcy lawyer will be prepared.
9. You get protection from harassment by creditors and collection agencies. Once you hire a bankruptcy lawyer, harassing phone calls from creditors will stop. Once a lawyer represents you, you can inform creditors or debt collectors and force their phone calls and letters to go through your lawyer instead. After you officially file, an automatic stay will be granted, which legally extends your harassment relief.
10. Lawyers offer you peace of mind and protection from uncertainty. Peace of mind goes a long way. You won’t have to worry about mistakes, losing your assets, or preparing for a court appearance. Your bankruptcy lawyer will advise you on what will happen ahead of time, complete your paperwork correctly, and sit by your side in creditor meetings or court. It is your lawyer’s responsibility to fight for the best outcome for you and protect your rights.
Risks of Filing Bankruptcy without a Bankruptcy Lawyer
One little mistake could cost you everything. If you file incorrectly or the filing is incomplete, the bankruptcy judge could throw out your case. If that happens, you may not be able to refile for any type of bankruptcy in the near future or if you can refile, you may lose protection from creditors taking action against you. Incorrectly listing assets could cost you not only your debt being discharged, but you could lose the possessions you sought to protect.
Bankruptcy lawyers know how to protect your assets and successfully lead you through the process.
Mistakes could mean criminal charges for fraud or perjury. Committing fraud in a bankruptcy case can land you in jail. You cannot hide assets or income from the bankruptcy trustee or judge (even those that you haven’t received yet). Do you know the law well enough to avoid this serious situation? Did you sign over a vehicle, deed property, gift money, or other assets to a friend or relative? A bankruptcy lawyer will help you file your petition and truthfully list your assets in a way that protects you from criminal charges. You may end up paying more of your debt. When communications between the bankruptcy trustee and your creditors occur, can you respond without negatively impacting your bankruptcy discharge? If a creditor files a lawsuit or contests your discharge of debt – how will you respond? A bankruptcy lawyer can protect your interests, effectively communicate with all parties involved, and save you money in negotiating with creditors.
Free Initial Consultation with Lawyer
It’s not a matter of if, it’s a matter of when. Legal problems come to everyone. Whether it’s your son who gets in a car wreck, your uncle who loses his job and needs to file for bankruptcy, your sister’s brother who’s getting divorced, or a grandparent that passes away without a will -all of us have legal issues and questions that arise. So when you have a law question, call Ascent Law for your free consultation (801) 676-5506. We want to help you!
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506