Should I Seek Legal Help From A Bankruptcy Attorney?

Bankruptcy can be a misunderstood topic that can also be a very scary thing to consider if you don’t really know how the process works or who to turn to for accurate information.

While we all more or less know when enough debt is enough, most of us, nevertheless, struggle to seek legal advice because talking about debts and other financial issues to strangers is a thing we rather don’t do.  However, this is where the problem starts.  If you wait too long before seeking legal advice many options may be foreclosed to you.  If you attack your debts early, you will have more options available to you.

If you are already struggling to make your monthly payments, you may want to talk to a bankruptcy attorney who can guide you in the right direction to handle your debt problems.

Some questions a bankruptcy attorney may ask you are:

What type of debts do you owe?  A common answer here is medical or credit card bills.

Are you able to pay the minimum payments on your bill?  This question helps the attorney to figure out what types of bankruptcy may be available to you.

Do you find yourself spending more money that you make?

Are creditors constantly calling you?

Are your paychecks being garnished?

Once you scheduled your first consultation, come prepared to the initial meeting.  Write down some of the questions you should ask.

For example:

1. Am I a candidate for bankruptcy?

This question is a very broad one that has many different answers based on your fact pattern.  The attorney should explain the different options available to you and give you an overall picture of your options before proceeding.

2. What are the benefits of filing for bankruptcy?

The attorney should describe the benefits for filing bankruptcy and how they would vary depending on your unique fact pattern.

3. What are the negative effects of filing for bankruptcy?

Filing for bankruptcy doesn’t necessarily mean you’re free and clear of all debts. For example student loans, child support and alimony obligations are not dischargeable in bankruptcy. The attorney should inform you of all of the consequences that may result from a bankruptcy filing versus what the effects would be if you did not file.

4. What information is needed to get started?

The more information an attorney asks you to provide, the better it is.  To avoid having your bankruptcy case dismissed, at the very minimum you’ll want to have all of your financials and paperwork in order.  Your attorney should provide you with a detailed list of the information required for your case.

5. How does bankruptcy affect my foreclosure proceedings?

In general, once you file for bankruptcy , any creditor actions, which includes foreclosure, will be stopped immediately.  In legalese, it’s called automatic stay relief. However, this will provide only temporary relief if you file a Chapter 7 bankruptcy. In order to keep the home permanently, you, as the debtor, must file a chapter 13 bankruptcy which can force the creditor to accept monthly mortgage payments. The problem is, the debtor must immediately start making these payments plus bring the mortgage arrears current over a period of up to 5 years.

6. Does my income affect the filing a bankruptcy?

If you make too much money, it can be true, but rare, that a potential debtor will be prevented from filing a Chapter 7 bankruptcy because of their income.  The attorney should describe to you what is called a “Means Test” that is used to create a presumption as to whether the debtor may file a Chapter 7 bankruptcy.  Note that the vast majority of individuals who need to file for bankruptcy are under the medium income number, and therefore there is no presumption of abuse.  Currently, the medium income figures range from roughly $40,000 for a one person household to over $66,000 for a 4 person household.  Even if your income is above the medium income figures, it still does not mean a chapter 7 bankruptcy cannot be filed.  The Means Test provides for deductions based on numerous categories, such as transportation expenses, food, secured debt, including mortgage payments, health insurance, income tax deductions and others. After the deductions have been calculated, if your monthly income is under $110.00 per month, there is no presumption of abuse.

7. Who will accompany me to court?

Going to court could be the most nerve-wracking part of the process for a bankruptcy filer.  During this time, you will want the attorney that has been handling your case at your side not a paralegal.  There may be a chance that a different attorney from the same firm could go to court with you, so you’ll want to be reassured that he/she has been briefed on your case and will serve as a strong representation of your primary attorney. Your attorney should inform you of this in advance.

8. Do you use a written fee agreement?

The answer to this question should be a resounding YES. It’s important for you and your attorney to have a formal agreement stating what you will pay and what services are and are not covered. An oral agreement just won’t suffice.

Generally, don’t be afraid to ask questions.

The more questions you ask the more it shows that you have been thinking about this case and are serious about taking action.  By the end of your initial consultation, you want to be completely comfortable with your bankruptcy attorney’s abilities and what you can expect in the event you want to hire him or her.

At Seff & Capizzi Law Group, we regularly assist clients with their bankruptcy cases and provide valuable information for those who are interested in filing. We have a full-page on chapter 7 bankruptcy on our site.  Click here for more information or just give us a call at 954-920-9220.  Ask for Mark Seff.  At Seff & Capizzi Law Group, we have over 30 years of bankruptcy experience and offer a free consultation to see if we can help you move forward to obtain a fresh financial beginning.