Bankruptcy is not your best option in getting out of debt, but if you choose to pursue it, there are plenty of qualified people out there who can help. If you hire a bankruptcy lawyer, you can get counsel on state bankruptcy laws, which type of bankruptcy you should file, and the cost of the entire process. This will be valuable information while you recover from your legally declared insolvency.
Right off the bat, you likely don’t know a specific bankruptcy lawyer, so you need to ask around. Believe it or not, the first place you can turn to is your family and friends. If anyone you know has filed for bankruptcy in the past, ask him/her about the experience and whether or not he/she could refer you to a lawyer. If you don’t have friends or family with this experience, ask your attorney (if you have one) for any references. If this is no help, you should contact your state Bar Association and ask for the names of lawyers certified by the American Bankruptcy Institute, an organization of over 12,000 bankruptcy and insolvency professionals.
Once you get in touch with a lawyer, you need to ask some questions. First, you need to know how much the actual counseling will cost. If you can’t afford the cost, you can ask for pro bono legal counsel. Under American Bar Association ethical rules, lawyers are recommended to contribute at least 50 hours of voluntary, unpaid service per year. (Pro bono is short for “pro bono publico”, meaning “for the public good.”) Pro bono is not mandatory, so this option might not be available. Ask your lawyer about how many bankruptcies he/she handles on a yearly basis. You should also ask about what exactly the process of bankruptcy entails (you will typically get six months to contact a credit counseling agency to draw up a budget), what property you can keep, and which debts get taken care of after filing bankruptcy. (Child support and student loans are two types of loans that do not get cancelled.)
Once you have determined which type of bankruptcy you are filing, the final step is determining the fees. A Chapter 13 bankruptcy will cost more than a Chapter 7 bankruptcy because Chapter 7 involves liquidation, or the selling of your property, while Chapter 13 is merely a restructuring. However, if you have filed a Chapter 13 bankruptcy, you can still sell some of your assets to come up with adequate payment. Your bankruptcy lawyer can set up a payment plan if you can’t pay all the fees upfront, and you will pay in installments until the bankruptcy has been discharged.
Lawyers are not out there just to make money; they truly want to help you get back on track. Ask your friends and family first, and you might have a more positive experience with a bankruptcy lawyer.
He played clarinet for the Marching Tar Heels in 2005 and 2006. He also volunteered for STV, the student-run television station at UNC-Chapel Hill, in the spring of 2010. He shot video, wrote scripts, and acted for “Off the Cuff,” UNC’s longest running sketch comedy show. He has the rare distinction of having lived in a dorm all four years of his undergraduate college career. He was also on Franklin Street on the night of April 4, 2009. His future plans are to pursue a master’s degree in journalism and to one day work for the media as a sports journalist or broadcaster.
Being one of eight children, David realizes finance is an important topic to everyone, regardless of his/her knowledge of the subject. His interests are in personal finance, budgeting, and savings.
In his spare time, David enjoys watching sports and standup comedy, as well as doing crossword puzzles and writing in the first person. He also thoroughly enjoys trivia and, one day, hopes to participate on the game show Jeopardy!, where he will try to break Ken Jennings’ 74-game win streak.