How do you know which bankruptcy attorney to hire? Before choosing an attorney you should have some basic knowledge about the types of consumer bankruptcy available. Our home office is in Kansas, so we will approach things from that perspective in this document.
Most people who are thinking about a bankruptcy will eventually file a Chapter 7 or Chapter 13 bankruptcy. These are the basic choices you have when filing a bankruptcy but they are very different.
Chapter 7 is a basic case, sometimes referred to as a Fresh Start bankruptcy. You pay the fees to the bankruptcy attorneys before filing. With Chapter 7 you are generally discharging debts such as credit cards, medical bills, and personal loans. You continue to pay secured debts if you want to keep the property securing the loan. It will not correct or fix a default if you are behind on a car or a house loan. It can be very effective if planned out correctly but there are always some risks. It will be very disappointing if it is done incorrectly as you could lose assets or worse.
Chapter 13, also know as a Wage Earners bankruptcy, is a more complex case. Fees are paid through the case (not upfront) and you are making a payment into a bankruptcy trustee for 36 to 60 months. You are usually filing this kind of case because you are trying to keep a car, a house, pay tax debt, stop a student loan garnishment, or simply have no upfront money to do a Chapter 7. It is generally more effective than a chapter 7 and slightly more expensive but there is usually no risk of losing assets.
Hiring the right bankruptcy attorneys is crucial to getting the right outcome for your debt situation. For this reason, you will need to do some research before you choose. Here are the top five things to look for in bankruptcy attorneys:
- Knowing the Cost
- Expertise and Experience
- Knowledge of Local Rules and Practices
- Support Staff
- Communication
KNOWING THE COST
A good lawyer should explain how cost-effective a bankruptcy will be for you compared to other options. You should have an idea of the value that will be provided by filing the bankruptcy. Understanding the differences between bankruptcies and other options can give you a real idea of whether it is financially worthwhile to file a bankruptcy case.
Once you have decided to file a case the cost for the bankruptcy attorneys services will be a key element in deciding who to hire. You need to make sure you are going to get exactly what you need from the bankruptcy attorneys to help justify the fees.
Most bankruptcy lawyers use a standard agreement for a basic Chapter 7 or Chapter 13 case. The fee should include an initial consultation and analysis of your financial situation; review and preparation for filing the bankruptcy petition; attending the meeting of creditors (a 341 meeting) and following-up with creditors – such as taking action to stop any post-filing collection efforts. In many cases it will be a flat fee for basic work and hourly for work beyond that.
In Chapter 13 the fee should also include preparation of the reorganization plan and representation at the confirmation hearing. You should make sure these services are all clearly spelled out in the representation agreement.
Bankruptcy attorneys are required to abide by certain rules with respect to fees. The court and the bankruptcy trustee will review the attorney fees to make sure they are reasonable. In many places there are fee guidelines set out by the court. Even when there are no specific guidelines the court may give the attorneys an idea of what is an allowable fee. Often this means the initial fees charged by the attorneys are almost the same from office to office.
You should always ask how often the attorney bills for additional fees in their cases. You should also ask how they track their time and if they bill for paralegal time. There is nothing wrong with them doing this but you want to know beforehand so there is no sticker shock later on.
EXPERTISE & EXPERIENCE
Any attorney with a federal license in Kansas could in theory file a bankruptcy in Kansas. However, hiring someone with no experience in bankruptcy is probably a bad idea.
You would hire an ophthalmologist for an eye surgery, not a cardiologist. They might both be medical doctors but if you need surgery on your eye then one of them has a much greater expertise than the other.
Attorneys are no different. While years of general practice are often a good measure of an attorney’s qualifications it isn’t the only thing to look at. It is often the percentage of the attorney’s practice that constitutes bankruptcy and how many bankruptcy cases the attorney has filed that are more important.
You should ask the attorneys you meet detailed questions about their practice areas. If they include a lot of different practice areas in addition to bankruptcy, for example, you might be better served to find a lawyer who focuses on bankruptcy or at least has a more limited scope of practice. A strong focus on bankruptcy is a key component in finding good representation.
The answers to your questions are critical; if the attorneys are evasive and don’t satisfy you with their answers, they may not be the right bankruptcy attorneys for you. Ask how many bankruptcies they have handled in their careers. Ask how many bankruptcy cases they handle in a month or a year. Ask if they are handling business cases or consumer bankruptcy cases. Find out if they represent creditors like banks or if they limit their practice to debtors. A good bankruptcy lawyer will have no problem disclosing these things to you and most of them will be very happy to do so.
KNOWLEDGE OF LOCAL RULES AND PRACTICES
The Bankruptcy code reform increased the complexity of consumer bankruptcy cases. Even today the law is changing and often what is appropriate in one court is not appropriate in another court. Your attorney should be knowledgeable about the local rules in the bankruptcy court where they practice.
In Kansas you get to choose where you will file your case. Although those options are very similar in 80% of the cases, there are some differences that might matter. There are three bankruptcy courts and each court has its own way of handling cases, and you want your lawyer to be able to navigate not only the bankruptcy law but the nuances of how the local courts work.
Every bankruptcy judge has a slightly different view of how the law will apply to a specific case. In general you get very similar opinions from the bankruptcy judges in the same jurisdiction, but if there is a substantial difference your lawyer should know about it.
The bankruptcy trustees also run their offices differently. There are different trustees in Wichita, Topeka, and Kansas City. Your attorney should have an idea of how the different trustees run their offices so they can give you an idea of what will happen depending on where you file your case.
Ask the bankruptcy attorney how your case might be impacted by the bankruptcy code and the local rules; they should be able to give you an idea about your potential outcomes at your initial consultation.
SUPPORT STAFF
You must decide if you want to hire someone that does everything themselves or if you want a firm where there are support staff. Your attorney’s time is valuable and there is a lot to do in running a bankruptcy case.
Support staff often help manage attorney’s time, check calendars, handle mailings, and post documents. This enables the lawyer to focus on applying the law to the facts of the case. An office with no support staff is limited in terms of how much work can be handled and what can be done in a given day. If your lawyer is handling every administrative task then they can often be overwhelmed.
You should be on the lookout for red flags that could indicate your lawyer does not have enough support staff. Are there files piled up everywhere? Do phone calls go unanswered? What happens if your attorney is ill or unavailable? An attorney’s office should have all of this planned out beforehand.
COMMUNICATION
You need to trust that you can communicate with your bankruptcy attorney and that they can explain things to you. There should be no concept your bankruptcy attorney cannot explain in normal language. Many ideas in bankruptcy sound unusual at first but your attorney should be able to go over them with examples to help you understand what they mean and how they will affect your case.
If you find that your communication with your attorney is constantly filled with legalese and your lawyer never explains anything then it may be difficult to make your case work. You should not expect to become a bankruptcy attorney after your lawyer explains things to you. You should expect that it made sense to you when they went over it with you. If they cannot explain things or if they blow you off when you ask questions then there is a problem.
To find out more about how Coons & Crump, LLC, can help you through the bankruptcy process, call our office today and schedule your free consultation. In many cases an attorney can get on the phone with you right away. We have three bankruptcy attorneys with over 30 years of combined experience and four bankruptcy paralegals with over 60 years of combined experience. We limit our cases to consumer bankruptcy cases and we never represent creditors or businesses. We have offices in Wichita, Topeka, Lawrence, and Kansas City and we are familiar with the local bankruptcy courts and trustees.
We take the guesswork out of filing bankruptcy. We are dedicated to providing the best legal representation to our clients in the most efficient and knowledgeable way. Our experience includes representation for people just like you in over four thousand consumer bankruptcy cases in Kansas. Put that experience to work for you today. Call now.