Bankruptcy attorneys are an essential element to obtaining court approval in both individual and corporate cases. Individuals are allowed to file petitions without legal counsel, but companies must have a legal representative.
Although bankruptcy attorneys are not required for personal bankruptcy, filing without legal counsel can be a costly mistake.
New guidelines enacted under the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) has made it extremely difficult to undergo the process alone. One missed deadline or improper form could cause debtors to have their petition denied and lose the option of obtaining debt help through this method for 8 years.
Lawyers that specialize in this field can help guide debtors through the process and ensure they comply with BAPCPA regulations. Most attorneys specialize in either personal or corporate bankruptcy, but some offer both. This can be helpful to debtors who operate business as a sole proprietor or partnership.
Within the United States there are six bankruptcy chapters. Chapter 7 and 13 are used for personal bankruptcy, while 9 and 11 are used for partnerships and corporations. Chapter 11 can also be used by individuals who meet certain criteria. Commercial farmers and fishermen file for protection under Chapter 12, while Chapter 15 is reserved for international cases.
It can be advantageous to shop around for bankruptcy attorneys. The process can be somewhat intrusive because lawyers need to know everything about personal finances. Debtors often spend a lot of time with their attorney, so it can be helpful to work with someone you can be comfortable with while having a high level of confidence in their ability to get things done.
The majority of law firms offer complimentary meet and greet sessions to answer questions. When possible, meet with three or more attorneys and their staff. Paralegals carry the vast majority of workload on bankruptcy cases. This is beneficial to clients because it reduces their legal fees.
When setting up appointments request to meet all personnel working on your case. If you aren t comfortable with team members or don t mesh with their personalities, don t hire them. Bankruptcy is a tough process and working with lawyers you don t like makes the process even more difficult.
It can be helpful to spend time learning about BAPCPA and researching bankruptcy alternatives before hiring a lawyer. The new laws can be difficult to fully comply with because they require debtors to establish a payment plan that can extend for up to 5 years.
Bankruptcy payments are in addition to normal monthly expenses. Those already struggling to make ends meet will find it difficult to adhere to payment plans. If debtors do not comply the court can dismiss their petition and creditors can take legal action.
BAPCPA requires debtors to engage in credit counseling before their petition is approved. This can be helpful to debtors unfamiliar with money management skills. It can also be helpful to those who have incurred high level debts through dire situations such as chronic health problems, long term unemployment, or death of a spouse.
Credit counselors are sometimes successful negotiating payment plans with creditors and can help debtors avoid bankruptcy altogether. Creditors have a tendency to be more open to negotiation when bankruptcy is a probability.
If bankruptcy is the only viable option, take time to find the right bankruptcy attorneys for the job. A good place to start is the American Bar Association website at abanet.org.
Author Resource:-
Simon Volkov presents a comprehensive personal bankruptcy article library covering topics of questions to ask bankruptcy attorneys; ways to avoid bankruptcy; mortgage bankruptcy; and more at http://www.SimonVolkov.com.
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