Bankruptcy attorneys are business attorneys who specialize in bankruptcy proceedings, or court proceedings intended to reduce or eliminate debt. Some bankruptcy attorneys only do consumer bankruptcies, and others only do business bankruptcies. These attorneys generally assist persons or organizations who are filing for bankruptcy, which can include:
- Corporations; or
- Individual consumers.
Bankruptcy lawyers provide services such as:
- Informing clients of their options regarding bankruptcy filings, such as whether they should file for Chapter 7 vs. Chapter 13;
- Determining whether there are any viable alternatives to filing bankruptcy;
- Assisting with paperwork, tax records, account books, and other such documents;
- Representing clients in court during hearings and meetings;
- Communicating with insurance companies and other related parties; and
- Handling related matters such as property liens, collections, automatic stays during proceedings, etc.
As such, bankruptcy attorneys must stay well-versed in various areas of law and finance matters. Bankruptcy proceedings are somewhat unique in that they are not as conflict-based as other forms of legal proceedings. However, legal conflicts do often occur in connection with bankruptcy. This is especially true when dealing with creditors and collections.
Each type of bankruptcy has its own advantages and disadvantages. A skilled and knowledgeable bankruptcy attorney will be able to explain to you what your options are, as well as the benefits and downsides to each option. The following is an incomplete list of such examples:
- Chapter 7
- Quicker and simpler than chapter 11;
- Only one court visit, which is to file the petition;
- Some property must be sold;
- Requires a court appointed trustee to manage the bankruptcy; and
- Business is unlikely to continue operation after bankruptcy.
- Chapter 11
- Business is likely to continue operating after bankruptcy;
- Property need not be sold;
- No trustee is necessary since the business will continue to operate;
- Longer and more complex than chapter 7; and
- Debts must eventually be paid.
Who Can Benefit from Hiring a Bankruptcy Attorney?
Simply put, any person who thinks they may need to file for bankruptcy would benefit from hiring a bankruptcy attorney. Personal bankruptcy refers to when an individual files for bankruptcy. This differs from commercial or business bankruptcy, which is filed by a business organization. Personal bankruptcy is also known as consumer bankruptcy and generally involves a person’s debt due to spending.
Generally speaking, people file personal bankruptcy in order to wipe out their debts and obtain a fresh financial start. While this can have some negative short-term effects on their credit, filing for bankruptcy can be helpful in the long run.
Additionally, consulting with an experienced bankruptcy attorney is important for individuals that are wishing to keep personal property through the bankruptcy process. For example, one of the greatest conflicts in bankruptcy proceedings, is creating a bankruptcy plan that allows an individual to keep their home residence or vehicle. It is important to note once again that there are certain federal and local bankruptcy exemptions that an individual can claim, which allows them to set aside certain pieces of properties and assets.
Therefore, a thorough comprehension of your state’s exemptions is essential in protecting your personal property throughout the bankruptcy process. In addition to exemptions, debtors may also come to an agreement with their creditors as to a payment plan for their outstanding debts.
If you are a small business owner, and you are struggling with a significant amount of debt, Chapter 7 bankruptcy may be helpful in this situation. Chapter 7 bankruptcy can eliminate most or all of the debts that you are liable for. If you are a sole proprietor, or your business is considered a general partnership, you are personally liable for your business’s debts. Because of this, you may also be able to file a Chapter 7 to eliminate most or all of your debt.
It is important that you bring any evidence you have to your initial appointment with the attorney. This information will help the lawyer evaluate your claim, as well as provide accurate advice. The lawyer may want to see:
- Recent bills, mortgage statements, and other debt-related documents;
- Bank statements;
- Foreclosure or eviction notices;
- Letters or other correspondence from debt collectors;
- Legal documents relating to debt collection, especially any lawsuits and judgments;
- Insurance policies;
- Titles to your vehicles and real estate;
- Check stubs and tax returns; and
- Your current mortgage or lease.
How Can I Find a Local Bankruptcy Attorney?
Finding the right bankruptcy attorney is imperative when you are going through the bankruptcy process. When hiring a personal bankruptcy attorney, you should be sure to:
- Check the background, certification, and state bar licensing info of any attorney you might be interested in retaining;
- Let the attorney know if you have filed for bankruptcy before in the past, as you generally must wait a certain number of years before you can file again;
- Ask the attorney any questions that might be relevant to your bankruptcy filing;
- Be open and honest when explaining your financial situation to them; and
- Let the attorney know if there are any additional legal issues that they should be aware about, such as tax issues, non-dischargeable debt, property liens, etc.
Before meeting with a bankruptcy lawyer, you should prepare for your appointment. In order to understand your claim, the lawyer will need accurate and detailed information, as previously mentioned. While every lawyer has their own interview process, this is a list of the most commonly asked questions:
- Has a debt collector sued you?
- Are you facing foreclosure or eviction?
- What specific types of debts do you owe?
- What assets and income do you have?
When you are ready to find a bankruptcy attorney, you could begin by entering “bankruptcy lawyers near me” in a web search. There are several ways to locate bankruptcy attorneys in your area, such as the more traditional method of looking through a phonebook and calling attorneys who are near you. More recently, online databases have been created that can provide similar search listings. These listings provide the information necessary for you to call or contact multiple attorneys.
However, some common problems with these methods include:
- Can be time consuming;
- Can be inaccessible;
- Often no way to compare, review, or rate attorneys; and
- May not always lead to a suitable connection between an attorney and client.
One effective way to connect with a bankruptcy attorney is to utilize online matching services, such as those provided by LegalMatch.com. These services provide clients with direct matches to local attorneys in a timely and efficient manner. All suggested attorneys have been prescreened and are bar certified.
Do I Need a Lawyer for Help with Bankruptcy Issues?
As bankruptcy laws can vary from state to state, it is imperative that you consult with a bankruptcy attorney local to where you are. An example of this would be how California bankruptcy exemptions differ greatly from the exemptions allowed by other states. Because of this, you will need to ensure that you are filing in the correct court as well as in the correct jurisdiction. Additionally, you will need to have a strong comprehension of your local jurisdiction’s laws regarding bankruptcy.
Thus, it is in your best interests to consult with a skilled and knowledgeable bankruptcy lawyer in your area, if you are facing bankruptcy proceedings. An experienced bankruptcy attorney in your area can inform you of local laws as well as your rights, and any alternatives you may have to going through with a bankruptcy.