Why Hire a Bankruptcy Lawyer?
Individuals are allowed to represent themselves in a bankruptcy, but the experts strongly advise against it. Bankruptcy law is complex, and bankruptcy is a stressful and emotional process for many people. If you make a mistake, you risk repossession or liquidation of your house and other assets you’re trying to protect. Omitting some assets may even lead to criminal charges. With so much at stake, why take risks?
If you have property or assets you would like to keep it is time to talk to a bankruptcy lawyer who can:
- Provide a free initial consultation to review your financial situation
- Provide information about all of your options to alleviate debt
- Provide guidance through the complex bankruptcy process
- Assist in the completion of extensive bankruptcy paperwork
- Defend against challenges from lenders
- Ensure your rights are protected
- Pursue creditor litigation if needed
And more importantly, a bankruptcy lawyer doesn’t have to be expensive.
In Chapter 13 bankruptcies, some of your bankruptcy attorneys fees can simply be added to the debt in your repayment plan. In simple Chapter 7 bankruptcies, which are resolved quickly, a bankruptcy attorney’s fees are often under $1,500 and many bankruptcy attorneys offer payment plans. The attorney you’re considering hiring should be able to quote you a fee based on your unique circumstances. All of our bankruptcy attorneys offer a free initial consultation.
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Talking to family members or friends can be the first step to locating a bankruptcy attorney. Online searches can also be helpful. Schedule several meetings with different local bankruptcy attorneys and do not be afraid to interview the lawyer and leave the office without hiring them.
Another option is to review referrals provided by local bar associations and talk to other lawyers you know who may have their own recommendations.
Choosing the Right Lawyer
- Make sure the lawyer you choose specializes in bankruptcy law and understands the laws in your state.
- Find a bankruptcy lawyer who provides a free consultation to review your financial situation.
- Make sure you like the attorney and ask if they will be handling your case or if they will be handing it off to a paralegal.
- Don’t look for the cheapest lawyer. Make sure you like the staff and your calls are returned and answered promptly.
- Make sure you understand the costs of each lawyer you interview so you can accurately compare the services provided.
- Have the lawyer identify the services provided for the quoted price.
- Ask for references and follow-up to make sure past clients were happy with services provided.
Bankruptcy lawyers understand the bankruptcy process and after your initial consultation if you decide bankruptcy is right for you the bankruptcy lawyer will perform the following tasks:
- File your bankruptcy petition – whether you are filing for Chapter 7 or Chapter 13 Bankruptcy the bankruptcy petition must be filed in the appropriate bankruptcy court.
- File all bankruptcy schedules this includes completing all of the appropriate schedules (including the filer’s assets and liabilities, executory contracts, unexpired leases, statement of financial affairs, and current income and expenditures).
- Work with the debtor to create and file a Chapter 13 Bankruptcy plan. This plan must be submitted to the court 15 days from the date the bankruptcy petition is submitted. This is not needed for a Chapter 7 Bankruptcy.
- Attend the 341 Creditor Meeting with you (the debtor).
Additional tasks that the bankruptcy lawyer may be required to perform includes preparing an Objection to Proof Claim letter if creditors challenge debts, responding to questions from the trustee, replying to creditors who challenge debtor spending prior to filing bankruptcy, answering questions from the debtor, reviewing the bankruptcy schedules and petitions from the debtors, preparing for all court appearances and appearing in court as needed.
For more info on the petition, schedules, 341 meeting and more; visit our Bankruptcy Glossary of Common Terms
One of the biggest concerns for debtors is the cost of filing bankruptcy. Unfortunately, costs vary by state. In some areas of the country bankruptcy lawyers may charge as little as $750 for a simple, Chapter 7, no-asset case. In other parts of the country the fees can be as high as $1000- $2000, and unfortunately, most bankruptcy lawyers are going to require debtors to pay these fees prior to filing the Chapter 7 Bankruptcy petition.
What about hiring a bankruptcy lawyer to file a Chapter 13 case? Again, the costs can vary based on the length of the bankruptcy process, the location, and the experience of the lawyer. Some bankruptcy lawyers charge as little as $2,500 but others may charge $4,000.
All fees should be clearly outlined and all fees for any “extras” should be clearly documented. Remember, if you are quoted a flat fee this may only be for the basic, standard services. If debts have to be challenged, for instance, this can raise the costs.
If you need to save money find out if they are willing to negotiate the fees and if there are any tasks you can do yourself to reduce the costs. The good news is that many bankruptcy lawyers will allow a claimant to pay the fees through their bankruptcy plan.
Hiring a bankruptcy lawyer is a personal choice. Legally you are allowed to file a bankruptcy on your own or “pro se” but doing so will require time, knowledge of the bankruptcy process and a dedication to understanding bankruptcy laws. The courts will not give you a “pass” just because you do not understand the bankruptcy process.
As mentioned above, simple, no-asset Chapter 7 Bankruptcy cases will be the easiest to file alone, but if you are filing a complicated Chapter 13 bankruptcy case, legal help is highly recommended.
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