Debtors usually point to two reasons for not hiring an experienced Brooklyn bankruptcy lawyer before filing a chapter 7 case: affordability and necessity. Obviously, many people who owe significant debts frequently lack the money for a bankruptcy attorney. (As an aside, there are options for debtors who are too poor for bankruptcy filing fees.) The other reason, necessity, is also quite common. Anyone who knows what chapter 7 is understands that it’s just a process of filling out paperwork, showing up to a few hearings, and then presto: discharge!
Right? Often no.
Even for no-income, no-asset bankruptcy cases, this isn’t always true. Here are several reasons to hire a Brooklyn bankruptcy lawyer to a handle the deceptively simple chapter 7 case.
(1) Advising debtors of non-bankruptcy options they don’t know of: Sometimes debtors think chapter 7 bankruptcy is the best course of action when others might be available, depending on the debtors’ circumstances. For examples, debtors with tax debts can negotiate with the IRS to make offers in compromise to resolve them; debtors with mortgage problems might be able to negotiate a short sale; and student-loan debtors can use income-driven repayment plans or hardship discharges. Competent Brooklyn bankruptcy lawyers will inform debtors of alternatives.
(2) Saving debtors from bad bankruptcy alternatives: On the other hand, like the physician’s adage “first do no harm,” an experienced bankruptcy lawyer will discourage debtors from taking courses of action that will leave them worse off than bankruptcy, like trying to pay off their loans via a debt-settlement company.
(3) Knowing what questions to ask and helping to complete means-test paperwork: Just because chapter 7 is form-driven doesn’t mean it’s a simple flow chart. Many debtors do not understand the Bankruptcy Code’s terminology. Bankruptcy lawyers know how to ask the right questions and ensure that debtors pass the means test or skip it entirely.
(4) Protecting debtors from serious, avoidable mistakes: Many debtors don’t know of the ways their actions (or inactions) can sink their bankruptcies. Examples range from neglecting the simple steps required in chapter 7 bankruptcy cases, like completing the mandatory pre-bankruptcy debtor-education courses, to much graver ones, like making preference payments, fraudulent conveyances, or even failing to list claims that are assets, like personal-injury lawsuits. Taking to a lawyer prevents these pitfalls.
(5) Scheduling and keeping debtors’ assets: Pro se (self-represented) debtors also don’t often recognize the importance of claiming exemptions for their property or whether the federal or state exemptions are best for their situations. Hiring a lawyer can save you your house.
(6) Providing representation through the bankruptcy: A lawyer is the face of a debtor’s bankruptcy case and after filing assists in a variety of ways and for contingencies. This can mean coaching clients through the meeting of the creditors, negotiating with creditors, appearing at adversary proceedings, and seeking punishments for creditors who violate the automatic stay.
A lawyer may cost money up front, but it can save so much in the long run. If you are experiencing serious financial difficulties, then discussing your situation with an experienced Brooklyn bankruptcy lawyer can help you strategize your options.
For answers to more questions about bankruptcy, the automatic stay, effective strategies for dealing with foreclosure, and protecting your assets in bankruptcy please feel free to contact experienced Brooklyn bankruptcy attorney Bruce Weiner for a free initial consultation.