Bankruptcy Lawyer Bryan W. Stone answers the question: “Should I file bankruptcy?”
In any lawyer/client relationship, you have to feel comfortable with your representation. Bankruptcy is a stressful and complicated process. You should have no difficulty in asking your attorney questions, requesting explanations, and needing to go over your options during the course of your case. Strategy and filing deadlines are important in bankruptcy. For instance, the decision to file under Chapter 7 or Chapter 13 for individuals will determine the time-frame, which debts are discharged, and what kinds of property they will be able to keep.
How long have you been practicing bankruptcy law and have you dealt with cases similar to mine?
Bankruptcy is a complex area of law that requires an attorney with specialized knowledge. There are numerous procedures and requirements when filing a bankruptcy petition and throughout the entire process. While an attorney may “practice” in an area of law, you want to be sure that the attorney you choose has experience with cases similar to yours. If you have certain issues that are unique to you, hiring someone with this specialized knowledge will be critical to your case.
What kind of bankruptcy should I file?
Because there are different bankruptcy chapters you can file under, you will want to ask your attorney which one would be most beneficial to your case and goals. A simpler Chapter 7 liquidation will likely require much less work and fees than a more complicated Chapter 13 plan, which takes payments from you and through the bankruptcy trustee distributes them amongst your creditors. It is important to discuss and understand which bankruptcy avenue you will be pursuing.
Who will be filing my bankruptcy paperwork and guiding me through the process?
Additionally, you will want to know who will be filing and preparing your bankruptcy petition paperwork. There are firms that “specialize” in bankruptcy law which are actually just operate as more of a clearinghouse for cases. These are known as “bankruptcy mills.” You will want a qualified attorney reviewing your financial documents and preparing the important legal aspects of the petition to ensure it is correct. While there may be support staff to help with these processes, your attorney should be your primary point of contact during your bankruptcy.
Do I have any non-exempt assets?
Bankruptcy law exempts certain assets from being liquidated in the bankruptcy proceedings. This means that a creditor cannot take the asset (or a portion of the asset if there is an exempt value). Your attorney should know the exempt assets allowed in your state and advise you which of your assets may be exempt. This will affect the bankruptcy petition, amount in a payment plan under Chapter 13, or liquidation value under Chapter 7.
Are there risks in my bankruptcy case?
Your attorney should give you candid advice on your initial case and keep you informed throughout the process. For example, if you have student loans and you wish to discharge them in bankruptcy, you may have much more difficulty with that than with discharging your credit card debt. There are different standards for certain discharges and your attorney should know these intricacies to advise you appropriately.
If you gave property to a family member or a close business associate in the previous two years, you may encounter issues with that transfer when filing for bankruptcy. For instance, if you owned a piece of land and you realized that you may have trouble paying your creditors in the next year or two, so you transferred that land to your son, that transfer could be problematic in the eyes of the court. This is known as a fraudulent transfer: You transferred the property in order to keep it out of the hands of the creditors, intentionally lowering the available amount they could potentially collect.
How much will attorney’s fees be?
Fees can vary depending on the complexity of your case and which chapter you file under the bankruptcy code. A Chapter 7 filing is a complete liquidation of your assets and is generally not as resource-intensive as a Chapter 13 filing. A less experienced attorney (and therefore likely cheaper) may be adequate in a Chapter 7. However, a Chapter 13 filing may require a more experienced attorney who will likely charge a higher fee. While this question is important, it may not be in your best interest to always hire the attorney with the lowest fee.
The law firm of Arnold & Smith, PLLC has the experience and knowledge in bankruptcy and financial law to advise you further. Contact us today for a consultation of your case. We want to guide you through the bankruptcy process so that you can begin toward a better financial future. If you are contemplating bankruptcy in the Mecklenburg County, Iredell County or Union County area, please call the skilled lawyers at Arnold & Smith, PLLC at 704-370-2828 or find additional resources here.
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