Why $499 Bankruptcies Are Dangerous and Often A Bad Deal

The crash in the economy has hurt people in many professions, and has hurt the business of many lawyers. Law schools are continuing to graduate new lawyers every year and many are unable to find jobs. Experienced lawyers in areas such as real estate and construction are also struggling. This has caused a new explosion of lawyers flooding into the area of bankruptcy-an area that unfortunately increases when times are bad.

Many of these lawyers are fighting for cases and have slashed fees to get clients. Some claim to process cases for as little as $499. This would seem to be a benefit for clients who are struggling themselves with money.

Many of the low fees offered, however, are for a reduced level of personal service that actually hurts clients when cases are processed incorrectly by inexperienced lawyers, or, worse yet, shuffled off to unqualified assistants and clerks. A good lawyer must take the time to sit down individually with clients and explain the bankruptcy in detail. People need to know exactly what the bankruptcy will and will not do, and how it will affect them both immediately and in the future.

Also, many of these “$499 offers” are simply teaser prices and do not include the $299 Court filing fee or many additional add-on fees. For example, more fees are added on if it is a joint case (husband and wife) or if there is any property involved, or a number of other issues which are standard in a complete bankruptcy, but which may be used by some lawyers to increase the fees by deceptive advertising. In the worst case, some of these fees are for reduced services that can leave a client abandoned in the middle of a case that can have a disastrous result.

Bankruptcy is an extremely important life changing event that when done correctly can have an incredibly positive effect on your life. The basic principle of bankruptcy-overwhelming debt cancelled forever-is relatively straightforward. But legal representation in bankruptcy is like many things in life-you get what you pay for-and choosing a lawyer to represent you should not be determined solely on cost if you want your case to proceed smoothly. Just like you would not want the engine in your car rebuilt by a bad mechanic just because he is cheap, you do not want to get a bad lawyer for a bankruptcy just because of a low price. In the end, it’s just a bad deal for you.

Filing a bankruptcy can be a complex and emotionally challenging process with many pitfalls and problems if the case is processed without the supervision of an experienced attorney. This takes time and attention by the attorney in every single case to be sure all individual issues are properly analyzed. Two complex government legal departments are involved-the United States Trustees’ Office which is a division of the Justice Department, and the Federal Bankruptcy Court. In addition, most Bankruptcy Courts have numerous divisions (five in Colorado), and each individual Judge and Trustee has different rules and procedures that lawyers learn after many years of experience.

Processing a case through this legal maze can be a very smooth and rewarding experience with many benefits to the client, but must be handled and supervised by someone who knows what they are doing, and is committed to representing the client from the initial interview to the discharge and completion of the case. The work cannot be shuffled off on an inexperienced assistant but requires the time and attention of the lawyer.

This type of commitment is not available for the cheapest fee. Since the legal business is highly competitive, though, good lawyers work hard to price cases fairly and for as low as possible, including reasonable payment plans, to allow a client to get the very best representation for a fair and honest price.

In closing, choosing a bankruptcy attorney based solely on price is a dangerous proposition. Before even setting an appointment, call the office and see if you can talk to the lawyer who will represent you. Ask how long they have been practicing bankruptcy law. Be sure they are local attorneys who know the local court system. Also, be sure they ask you about your situation before agreeing to meet with you since all bankruptcies are different based on individual needs and you want to be sure the attorney you select cares about and understands your problems, and is not just trying to process a quick case and collect a quick fee.