Some clients try to conceal assets in bankruptcy. Even though their bankruptcy attorney has warned them of the consequences of concealing assets in bankruptcy, and their explicit instruction to be complete, accurate, and truthful in the information disclosed on the petition, some bankruptcy clients think they can outsmart the system. Read why blaming concealed assets on your bankruptcy attorney won't work.
Tying into the previous post, why attorneys tell clients to disclose all assets in bankruptcy goes over the disadvantages of concealing assets in bankruptcy. In short, clients risk committing perjury by concealing assets.
Many clients who turn to bankruptcy are facing a credit card lawsuit. Often these clients have been served with a complaint and have 30 days to respond to the suit. These clients call a bankruptcy attorney because they know that an attorney can stop a credit card lawsuit through bankruptcy.
Attorneys posting fake reviews of their own practice is becoming a real problem These bankruptcy attorneys create fake accounts and impersonate former clients while they post positive reviews of their own practice. This unethical behavior means that you need to watch out for fake attorney reviews.
The cost of bankruptcy is something that not all clients are prepared for. The several hundred dollar filing fee often surprises chapter 7 and 13 bankruptcy clients. Learn more on the cost of bankruptcy as explained by our attorney.
The bankruptcy lawyer consultation process is something that most prospective clients are unfamiliar with. This quick guide to the lawyer consultation process will help prospective clients prepare for their free consultation.
Lastly, finding information on the Sacramento bankruptcy court can be difficult. Our attorney has created this short post to help clients get some basic information about the court.
Find more posts by our bankruptcy attorney on bloglines.
Friday, June 28, 2013
Tuesday, June 25, 2013
California Bankruptcy Exemptions
Many people are worried that they will lose their property in bankruptcy. These people understand that chapter 7 bankruptcy involves the sale of property before they can receive a discharge, and mistakenly believe that all of their property will be sold accordingly. In truth, California has two exemptions schemes that can be applied in bankruptcy to take property off the "for sale" table. By exempting a particular piece of property in bankruptcy you are removing the equity you hold in property from the bankruptcy Trustee's grasp. In turn, you are allowed to retain that exempt property to the extent the exemption amount covers all of the equity in the property and the property is not encumbered by a lien.
As mentioned, California has two sets of exemptions known as the 704 and 703 exemptions, both of which are named after their respective code sections. The 703 exemptions protect fewer specific forms of property than the 704 exemptions but gives the debtor the ability to use a "wild card" exemption to protect over $23,000 of any property, including nonexempt property. The 704 exemption protects more specific forms of property and provides for a homestead exemption that can be used to protect equity in the debtor's home.
The 704 California exemptions protect many forms of property. Building materials are exempt up to $2,875 at the time of this writing. Reasonably necessary health aids are also exempt, as are reasonably necessary household furnishings, appliances, and wearing apparel. Up to $7,175 of jewelry, heirlooms, and works of art are exempt in bankruptcy. Tools of the trade reasonably necessary in your profession are also exempt in the amount of $7,175. Up to $2,725 of a motor vehicle is also exempt.
Read more about bankruptcy here, or visit our bankruptcy page. To learn more about our bankruptcy attorney at Sacramento Law Group click here.
California 704 Exemptions in Bankruptcy
As mentioned, California has two sets of exemptions known as the 704 and 703 exemptions, both of which are named after their respective code sections. The 703 exemptions protect fewer specific forms of property than the 704 exemptions but gives the debtor the ability to use a "wild card" exemption to protect over $23,000 of any property, including nonexempt property. The 704 exemption protects more specific forms of property and provides for a homestead exemption that can be used to protect equity in the debtor's home.
The 704 California exemptions protect many forms of property. Building materials are exempt up to $2,875 at the time of this writing. Reasonably necessary health aids are also exempt, as are reasonably necessary household furnishings, appliances, and wearing apparel. Up to $7,175 of jewelry, heirlooms, and works of art are exempt in bankruptcy. Tools of the trade reasonably necessary in your profession are also exempt in the amount of $7,175. Up to $2,725 of a motor vehicle is also exempt.
Read more about bankruptcy here, or visit our bankruptcy page. To learn more about our bankruptcy attorney at Sacramento Law Group click here.
Monday, June 24, 2013
Bankruptcy Attorneys Don't Charge That Much
If you just hired a bankruptcy attorney you probably disagree with this title. However, in comparison to the rates charged by attorneys in other practice areas, consumer bankruptcy attorneys don't charge that much. DUI attorneys: easily $4,000-$10,000 per case; personal injury attorneys: 30% of the tens of thousands of dollars recovered; divorce attorneys: $250 an hour for hundreds of hours; bankruptcy attorneys: $1,500-$4,000. Moreover, a percentage of the chapter 13 bankruptcy attorney fee is payable over 3 to 5 years. Hence, higher bankruptcy attorney fees come with built in financing, something atypical in the realm of attorney fees.
Most bankruptcy clients understandably balk at a $2,500 fee quoted for a chapter 7 bankruptcy, but compared to the rates charged by attorneys in other practice areas this seemingly high rate is anything but. If the attorney actually drafts the bankruptcy documents and responds to client calls throughout the bankruptcy case, the attorney will likely compensate themselves at an effective rate of approximately $100 an hour. Now, many bankruptcy attorneys do not actually draft the bankruptcy documents or personally respond to every client call. This prevalent bad behavior that frustrates clients is a necessary evil of a high volume practice with comparably low fees per case. Chapter 7 and 13 cases pass through a firm supply chain where tasks are performed by the lowest paid individual competent to handle the task. Bankruptcy attorneys who are the highest paid individuals in the firm naturally avoid time intensive tasks in low fee cases and instead rely upon cheaper paralegals or secretaries to handle time intensive matters. The consequence of this assembly line with minimal attorney involvement is often poor customer service as evidenced by the mounting frustration experienced by many clients of "bankruptcy petition mills."
The bottom line is that good bankruptcy attorneys who are generous with their time are often among the most expensive bankruptcy attorneys. Cheap attorneys may charge less, but will need to reduce their role in each case and utilize lower paid staff to turn a profit.
Find out more about our bankruptcy attorney here or click here.
Most bankruptcy clients understandably balk at a $2,500 fee quoted for a chapter 7 bankruptcy, but compared to the rates charged by attorneys in other practice areas this seemingly high rate is anything but. If the attorney actually drafts the bankruptcy documents and responds to client calls throughout the bankruptcy case, the attorney will likely compensate themselves at an effective rate of approximately $100 an hour. Now, many bankruptcy attorneys do not actually draft the bankruptcy documents or personally respond to every client call. This prevalent bad behavior that frustrates clients is a necessary evil of a high volume practice with comparably low fees per case. Chapter 7 and 13 cases pass through a firm supply chain where tasks are performed by the lowest paid individual competent to handle the task. Bankruptcy attorneys who are the highest paid individuals in the firm naturally avoid time intensive tasks in low fee cases and instead rely upon cheaper paralegals or secretaries to handle time intensive matters. The consequence of this assembly line with minimal attorney involvement is often poor customer service as evidenced by the mounting frustration experienced by many clients of "bankruptcy petition mills."
The bottom line is that good bankruptcy attorneys who are generous with their time are often among the most expensive bankruptcy attorneys. Cheap attorneys may charge less, but will need to reduce their role in each case and utilize lower paid staff to turn a profit.
Find out more about our bankruptcy attorney here or click here.
Bankruptcy Is An Economic Decision, Not A Moral One
Occasionally I read blogs related to bankruptcy, debt, and finances. On occasion I come across an anti-bankruptcy blog; one that tells debtors to avoid bankruptcy at all costs because it will ruin their lives. The messages contained in these anti-bankruptcy blogs are often the same: if you file for bankruptcy you will lose all of your property, ruin your credit, and cheat your creditors. While I often dismiss these blogs as oversimplified (and often plainly incorrect rubbish), I do on occasion come across an assertion that is wrongheaded: filing for bankruptcy is immoral. What this sentiment fails to recognize is that bankruptcy is a business decision, not moral one. When corporations pursue chapter 11 bankruptcy to restructure their debts they are not concerned whether they will hurt their creditors' feelings; they are making a business decision rooted in economic pragmatism. Bankruptcy is a product of debt which is the natural corollary to credit. In free markets credit is extended to facilitate consumerism and new profit-driven ventures. However, with the extension of credit comes debt, and a certain number of players will incur debt they cannot repay. When overwhelming debt is incurred bankruptcy is the process of reconciling those debts once and for all. Upon the completion of bankruptcy the debtor will reemerge free of crushing debt and able to participate in the market once again. Hence, filing for bankruptcy is not immoral just as it is not immoral for your credit card company to charge interest on your credit card balance.
Bankruptcy is an economic decision that should be made free of emotion and moral concerns.
To learn more about bankruptcy visit this site. To read more about Sacramento Law Group click here. View our bankruptcy attorney here.
Bankruptcy is an economic decision that should be made free of emotion and moral concerns.
To learn more about bankruptcy visit this site. To read more about Sacramento Law Group click here. View our bankruptcy attorney here.
Friday, June 21, 2013
Bankruptcy Lawyers & The Automatic Stay
Bankruptcy lawyers can help you fall within the protections of the automatic stay in bankruptcy. The automatic stay prevents creditors from pursuing collection efforts against you once you have filed for bankruptcy. For instance, once you file for bankruptcy creditors cannot foreclosure on your home or repossess your car. While the protections of the automatic stay is an operation of law and can be achieved without retaining a bankruptcy lawyer, enforcement of the automatic stay is another matter. A bankruptcy lawyer can help you put creditors on notice of the automatic stay and show creditors that violations will not be taken lying down.
A bankruptcy lawyer will file your bankruptcy petition with the appropriate bankruptcy court. Once your petition has been filed the automatic stay comes into effect preventing creditors from making collection calls, proceeding with a foreclosure sale, or sending demand letters. If a creditor violates the automatic stay by pursuing collection efforts your bankruptcy lawyer may take several steps. The lowest cost option will be for your bankruptcy lawyer to notify the creditor of the automatic stay and their recent violation. If the creditor continues to violate the automatic stay your bankruptcy lawyer may pursue a contempt action against the creditor. Sophisticated creditors are more likely to obey the rule of law and cease collection efforts against you once your bankruptcy petition has been filed, but less sophisticated creditors who operate out of emotion may recklessly violate the court order that is the automatic stay.
How A Bankruptcy Lawyer Can Help You Stop Creditors
A bankruptcy lawyer will file your bankruptcy petition with the appropriate bankruptcy court. Once your petition has been filed the automatic stay comes into effect preventing creditors from making collection calls, proceeding with a foreclosure sale, or sending demand letters. If a creditor violates the automatic stay by pursuing collection efforts your bankruptcy lawyer may take several steps. The lowest cost option will be for your bankruptcy lawyer to notify the creditor of the automatic stay and their recent violation. If the creditor continues to violate the automatic stay your bankruptcy lawyer may pursue a contempt action against the creditor. Sophisticated creditors are more likely to obey the rule of law and cease collection efforts against you once your bankruptcy petition has been filed, but less sophisticated creditors who operate out of emotion may recklessly violate the court order that is the automatic stay.
Thursday, June 20, 2013
An Overview Of The Average Bankruptcy Attorney in Sacramento, CA
While all bankruptcy attorneys have their own unique characteristics, there are some common elements that make up the average bankruptcy attorney in Sacramento. For instance, most Sacramento bankruptcy attorneys attended a law school within the greater Sacramento area. Furthermore, many bankruptcy attorneys in Sacramento practice consumer bankruptcy law, while only a few practice chapter 11 corporate reorganization. Lastly, the average bankruptcy attorney in Sacramento charges flat fees for chapter 7 and chapter 13 bankruptcy cases.
Continue reading to learn more about attorneys.
In terms of education, most bankruptcy attorneys in Sacramento attended a local law school. If you are fortunate your Sacramento bankruptcy attorney attended U.C. Davis School of Law, but more likely than not your local bankruptcy attorney attended a lower tiered law school in the greater Sacramento area.
Most bankruptcy attorneys in Sacramento practice consumer bankruptcy law, helping debtors in financial hardship reduce or eliminate debt through chapter 7 or chapter 13 bankruptcy. A few attorneys practice chapter 11 bankruptcy law.
The average bankruptcy attorney in Sacramento does not typically charge by the hour for chapter 7 and chapter 13 bankruptcy representation. Consumer bankruptcy attorneys normally charge a flat rate for consumer bankruptcy cases with an additional hourly rate for certain services. At times, a seemingly cheap attorney may prove to be an expensive attorney once the specifics of the representation agreement come to light. For instance, the several hundred dollar filing fee and other necessary expenses may be excluded from the attorney's quote and fee. Be sure to clarify what is and is not included in a Sacramento bankruptcy attorney's fee before signing a representation agreement. Some deceptive attorneys try to conceal certain fees in their low-ball quote. If a bankruptcy attorney tries this you may want t to consider finding a more honest honest lawyer. You do not want to hire a bad attorney and be stuck with their poor service throughout the duration of your bankruptcy. Instead, hire a bankruptcy attorney that adds value to your case and who will be available to you throughout the bankruptcy process.
Tuesday, June 18, 2013
Debts You Cannot Discharge In Bankruptcy
There are some debts you cannot discharge in bankruptcy. In general, student loans, domestic support obligations, fraudulently incurred debts, and certain credit card cash advances cannot be discharged in bankruptcy. These categories of debt are listed in Section 523 of the bankruptcy code which excepts certain debts from discharge. In contrast to Section 727 which denies the debtor a discharge entirely for certain bad acts, Section 523 only excepts specific debts from discharge. For instance, if a debtor files for chapter 7 bankruptcy and is found to have hindered, delayed, or defrauded a creditor as prohibited by Section 727 of the Bankruptcy Code, the debtor may be denied a discharge entirely; the debtor's credit card debt, medical debt, and any other debts will not be eliminated. However, if the debtor only incurred a particular debt under false pretenses, Section 523 of the bankruptcy code will except that particular debt from discharge, but the debtor will still receive a discharge of their credit card debt, medical debt, and other dischargeable debts. Hence, nondischargeable debt in bankruptcy is not the same as a denial of discharge in bankruptcy.
Recent income tax debt is not dischargeable in bankruptcy. However, if your income tax debt is more than 3 years old you may be able to discharge it in bankruptcy. Watch this slide to learn more.
Student loans are very difficult to discharge in bankruptcy. Unless you can satisfy the undue hardship exception you will not be able to discharge your student loans in bankruptcy. To satisfy the undue hardship exception & discharge your student loans you will have to prove 3 things: (1) based upon your current income and expenses you cannot maintain a minimal standard of living; (2) your state of affairs is likely to continue for a significant portion of the repayment period; & (3) you have made a good faith effort to repay your student loans. This test is extremely difficult to pass; therefore, you generally cannot discharge student loans in bankruptcy.
Domestic support obligations are also nondischargeable in chapter 7 and chapter 13 bankruptcy. The definition of domestic support is very broad, but the typical fact pattern involves a debt owed to a former spouse or child of the debtor in the nature of alimony, maintenance, or support established by a separation agreement, divorce decree, property settlement agreement, or court order. While domestic support obligations are nondischargeable in chapter 7 bankruptcy and chapter 13 bankruptcy, non-support debts may be discharged in chapter 13 bankruptcy upon full completion of the chapter 13 plan. In determining whether a debt is in the nature of support the court will evaluate the parties' intent and the spouse's need for support at the time of separation.
Debts incurred by false representations & actual fraud are excepted from discharge in bankruptcy. If the debtor makes a false representation to obtain credit and the creditor justifiably relied upon the representation, the debt is excepted from discharge under Section 523(a)(2)(A) of the Bankruptcy Code.'
Debts in the amount of $600 or more for luxury goods and services incurred within 90 days before bankruptcy are excepted from discharge. Luxury good and services in bankruptcy are extravagant and self-indulgent. For instance, a $600 salon appointment is likely extravagant and will probably qualify as a luxury service in bankruptcy. However, this presumption of nondischargeability only applies if the debt was incurred within the 90 days preceding the bankruptcy filing. If the debtor waits more than 90 days to file after incurring the debt the presumption of nondischargeability will not apply.
The Debts You (Generally) Cannot Discharge in Bankruptcy
Recent income tax debt is not dischargeable in bankruptcy. However, if your income tax debt is more than 3 years old you may be able to discharge it in bankruptcy. Watch this slide to learn more.
Student loans are very difficult to discharge in bankruptcy. Unless you can satisfy the undue hardship exception you will not be able to discharge your student loans in bankruptcy. To satisfy the undue hardship exception & discharge your student loans you will have to prove 3 things: (1) based upon your current income and expenses you cannot maintain a minimal standard of living; (2) your state of affairs is likely to continue for a significant portion of the repayment period; & (3) you have made a good faith effort to repay your student loans. This test is extremely difficult to pass; therefore, you generally cannot discharge student loans in bankruptcy.
Domestic support obligations are also nondischargeable in chapter 7 and chapter 13 bankruptcy. The definition of domestic support is very broad, but the typical fact pattern involves a debt owed to a former spouse or child of the debtor in the nature of alimony, maintenance, or support established by a separation agreement, divorce decree, property settlement agreement, or court order. While domestic support obligations are nondischargeable in chapter 7 bankruptcy and chapter 13 bankruptcy, non-support debts may be discharged in chapter 13 bankruptcy upon full completion of the chapter 13 plan. In determining whether a debt is in the nature of support the court will evaluate the parties' intent and the spouse's need for support at the time of separation.
Debts incurred by false representations & actual fraud are excepted from discharge in bankruptcy. If the debtor makes a false representation to obtain credit and the creditor justifiably relied upon the representation, the debt is excepted from discharge under Section 523(a)(2)(A) of the Bankruptcy Code.'
Debts in the amount of $600 or more for luxury goods and services incurred within 90 days before bankruptcy are excepted from discharge. Luxury good and services in bankruptcy are extravagant and self-indulgent. For instance, a $600 salon appointment is likely extravagant and will probably qualify as a luxury service in bankruptcy. However, this presumption of nondischargeability only applies if the debt was incurred within the 90 days preceding the bankruptcy filing. If the debtor waits more than 90 days to file after incurring the debt the presumption of nondischargeability will not apply.
Chapter 7 vs Chapter 13 Bankruptcy
Most individuals contemplating bankruptcy will have to choose between chapter 7 and chapter 13 bankruptcy. Often this election comes after the individual has received a free consultation with a bankruptcy attorney, and the decision made will likely be in accord with the bankruptcy attorney's advice. This very brief overview of chapter 7 and chapter 13 bankruptcy will hopefully impart a rudimentary understanding of bankruptcy to individuals so they may make a more informed decision.
Chapter 7 bankruptcy is known as the liquidation bankruptcy because non-exempt assets are sold before the debtor receives a discharge. However, despite the liquidation label, most chapter 7 cases do not involve a liquidation sale because most the debtor's property can be exempted under state exemption law. Once all of the property is exempt under state exemption law the property is not sold by the Trustee in bankruptcy. However, liens on real and personal property ride-through the bankruptcy absent permissible modifications or redemption of personal property.
Not everyone qualifies for chapter 7 bankruptcy. To qualify for chapter 7 bankruptcy the individual must pass what is known as the "means test;" an income qualifying test which favors individuals with low income or high secured debt. The specifics of the means test are complex, but some features can be quickly explained. You can bypass the means test and qualify for chapter 7 bankruptcy if your household's current monthly income is below the median income for a household of your size in your state. This safe harbor allows many lower income individuals to automatically bypass the means test and qualify for chapter 7 bankruptcy. However, if current monthly income exceeds this benchmark then the means test must be applied. One characteristic of the means test is that secured debt payments (car payments, mortgage payments) can be deducted in the test, thereby allowing individuals with high secured debt payments to pass.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy is the retain-and-pay form of bankruptcy. In chapter 13 bankruptcy the individual may retain his or her property (including non-exempt property to the extent permitted by the best interests test) but must repay all or a portion of their debts over a period of 3 to 5 years. Whether repayment must be 3 or 5 years in chapter 13 bankruptcy is determined by reference to the debtor's annualized current monthly income and the state median income for a household of the debtor's size. If the debtor's annualized current monthly income exceeds the state median annual income of a household of the debtor's size, the debtor must propose a 5 year repayment plan. However, if the debtor's annualized income falls below the state median the debtor can propose a 3 year repayment plan.
The debtor may not get to retain all of their non-exempt property in chapter 13 bankruptcy. For a chapter 13 plan to be confirmed it must pass the "best interests of creditors test" which requires general unsecured creditors to receive as much in chapter 13 bankruptcy as they would in chapter 7. If that second house would get sold in chapter 7 bankruptcy and unsecured creditors would get $50,000, the chapter 13 plan must propose to pay general unsecured creditors at least $50,000. Hence, not all property may be retained in chapter 13 bankruptcy.
In addition to the best interests test in chapter 13 bankruptcy, the chapter 13 plan must satisfy a few other conditions to be confirmed. First, the chapter 13 plan must be feasible. For a chapter 13 plan to be feasible it must have a reasonable possibility of success. For instance, if the debtor's schedules show expenses exceeding income, then it may appear that the debtor cannot afford chapter 13 plan payments and the plan may not be feasible. Second, the debtor's chapter 13 plan must be proposed in good faith. Good faith is not defined and really means the absence of bad faith. If the debtor proposes a chapter 13 plan that does not conflict with bankruptcy law or try to "sneak" something past the court the debtor's plan should meet this requirement. Evidence of bad faith may include dishonestly in reporting income and expenses.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy is known as the liquidation bankruptcy because non-exempt assets are sold before the debtor receives a discharge. However, despite the liquidation label, most chapter 7 cases do not involve a liquidation sale because most the debtor's property can be exempted under state exemption law. Once all of the property is exempt under state exemption law the property is not sold by the Trustee in bankruptcy. However, liens on real and personal property ride-through the bankruptcy absent permissible modifications or redemption of personal property.
Not everyone qualifies for chapter 7 bankruptcy. To qualify for chapter 7 bankruptcy the individual must pass what is known as the "means test;" an income qualifying test which favors individuals with low income or high secured debt. The specifics of the means test are complex, but some features can be quickly explained. You can bypass the means test and qualify for chapter 7 bankruptcy if your household's current monthly income is below the median income for a household of your size in your state. This safe harbor allows many lower income individuals to automatically bypass the means test and qualify for chapter 7 bankruptcy. However, if current monthly income exceeds this benchmark then the means test must be applied. One characteristic of the means test is that secured debt payments (car payments, mortgage payments) can be deducted in the test, thereby allowing individuals with high secured debt payments to pass.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy is the retain-and-pay form of bankruptcy. In chapter 13 bankruptcy the individual may retain his or her property (including non-exempt property to the extent permitted by the best interests test) but must repay all or a portion of their debts over a period of 3 to 5 years. Whether repayment must be 3 or 5 years in chapter 13 bankruptcy is determined by reference to the debtor's annualized current monthly income and the state median income for a household of the debtor's size. If the debtor's annualized current monthly income exceeds the state median annual income of a household of the debtor's size, the debtor must propose a 5 year repayment plan. However, if the debtor's annualized income falls below the state median the debtor can propose a 3 year repayment plan.
The debtor may not get to retain all of their non-exempt property in chapter 13 bankruptcy. For a chapter 13 plan to be confirmed it must pass the "best interests of creditors test" which requires general unsecured creditors to receive as much in chapter 13 bankruptcy as they would in chapter 7. If that second house would get sold in chapter 7 bankruptcy and unsecured creditors would get $50,000, the chapter 13 plan must propose to pay general unsecured creditors at least $50,000. Hence, not all property may be retained in chapter 13 bankruptcy.
In addition to the best interests test in chapter 13 bankruptcy, the chapter 13 plan must satisfy a few other conditions to be confirmed. First, the chapter 13 plan must be feasible. For a chapter 13 plan to be feasible it must have a reasonable possibility of success. For instance, if the debtor's schedules show expenses exceeding income, then it may appear that the debtor cannot afford chapter 13 plan payments and the plan may not be feasible. Second, the debtor's chapter 13 plan must be proposed in good faith. Good faith is not defined and really means the absence of bad faith. If the debtor proposes a chapter 13 plan that does not conflict with bankruptcy law or try to "sneak" something past the court the debtor's plan should meet this requirement. Evidence of bad faith may include dishonestly in reporting income and expenses.
Monday, June 17, 2013
What Does A Bankruptcy Attorney Charge for a Chapter 7 Bankruptcy?
Every bankruptcy attorney gets this question from a prospective client: "how much do you charge for a chapter 7 bankruptcy." If that question comes during the initial consultation after the attorney has conducted a thorough inquiry of the facts surrounding the case, that question can easily be answered. However, this question often arises if the attorney speaks with the client before the initial consultation. Many first-time callers are prone to determine what their bankruptcy will cost right off the bat, and many bankruptcy attorneys must disappoint these callers with the news that they will have to attend a free consultation before a firm price can be established. Sorry prospective clients, but every case is different.
Sacramento bankruptcy attorneys can charge anywhere from $500 to well over $4,000 for a chapter 7 bankruptcy. The price variation is due to 2 factors: (1) the bankruptcy attorney & (2) the complexity of the case. Extremely cheap Sacramento bankruptcy attorneys may charge as little as $500 for a no-asset chapter 7 bankruptcy. (I suspect that the $306 filing fee and other expenses are not included at this rock-bottom price). More expensive Sacramento bankruptcy attorneys may charge anywhere from $1,500 to $2,500 for a no-asset chapter 7 bankruptcy. Apart from price variation among attorneys, the complexity of the chapter 7 bankruptcy may also affect the price. Simple chapter 7 bankruptcy cases often involve 100% exempt assets and primarily unsecured debt. Complex chapter 7 bankruptcy cases may involve businesses, complex transaction histories, and many creditors and/or assets.
There are many factors that influence Sacramento bankruptcy attorney price variations. Attorneys with high overhead may pass this cost onto their clients, and thereby charge more than their competitors. For instance, some Sacramento bankruptcy attorneys are expensive because of advertising. By investing heavily in advertising these bankruptcy attorneys experience a greater call volume and can adjust their optimal price (the profit maximizing price). Other bankruptcy attorneys charge more because they are experienced, and clients with knowledge or belief of the bankruptcy attorney's experience are willing to pay more to retain the attorney.
Regardless of how much an attorney should cost, what Sacramento bankruptcy attorneys actually charge is something every prospective bankruptcy client must consider. In practice, prospective bankruptcy clients will find attorneys through the internet, phone book, or personal referrals. After attending a few consultations and receiving some quotes these prospective clients will have to make a hiring decision. As mentioned earlier, many prospective clients will choose the cheapest bankruptcy attorney (and will often be disappointed down the road) rather than choosing the attorney who will deliver the most value relative to their fees. Moderately priced bankruptcy attorneys with good communication and a hands-on approach to representation may deliver more value than cheap bankruptcy petition mills that churn out bankruptcy documents and uninformed clients.
Well, what do Sacramento Bankruptcy Attorneys Generally Charge for a Chapter 7 Bankruptcy?
Why are some Sacramento Bankruptcy Attorneys More Expensive Than Others?
Bottom Line: Bankruptcy Attorney Fees Vary, But Look For Value Over Cost.
Sunday, June 16, 2013
Should I Hire A Cheap Bankruptcy Attorney?
Many bankruptcy clients shop for a cheap bankruptcy attorney. In searching for a cheap bankruptcy attorney clients will quickly find that they cannot receive a quote over the phone. Consequently, these clients must attend a free consultation, take an hour of the attorney's time, and receive a quote at the end of the consultation. This labor-intensive process is an unfortunate necessity of shopping for cheap attorneys.
Now for the unfortunate truth about hiring a cheap Sacramento bankruptcy attorney: you get what you pay for. At first you will be thrilled (well, mildly OK) with hiring the cheapest Sacramento bankruptcy attorney among the several you interviewed. Shortly after that you will start wondering why you can't get the attorney on the phone. Every time you call the attorney you speak with a secretary and leave messages on voice mail. It seems as if the attorney just doesn't have time for you. Your questions may get answered in time, but possibly not in a clear manner. Furthermore, when issues arise after filing you may find yourself conducting your own legal research rather than getting clear advice from your attorney. This may sound outrageous (and it is) but it is not unusual.
You should hire a cheap attorney when you absolutely cannot afford between $1,500 - $2,000 and your chapter 7 bankruptcy is fairly simple. If your chapter 7 bankruptcy case is fairly straightforward, a cheap bankruptcy attorney will likely deliver the same result as an expensive attorney. You may not get the personal attention you want with a cheap bankruptcy attorney, but you will save money in your quest to discharge debt and receive a fresh financial start.
To learn more about our Sacramento bankruptcy attorney (who is not the cheapest, but also not the most expensive) visit http://sacramentolawgroup.com/sacramento-bankruptcy-attorney/
Now for the unfortunate truth about hiring a cheap Sacramento bankruptcy attorney: you get what you pay for. At first you will be thrilled (well, mildly OK) with hiring the cheapest Sacramento bankruptcy attorney among the several you interviewed. Shortly after that you will start wondering why you can't get the attorney on the phone. Every time you call the attorney you speak with a secretary and leave messages on voice mail. It seems as if the attorney just doesn't have time for you. Your questions may get answered in time, but possibly not in a clear manner. Furthermore, when issues arise after filing you may find yourself conducting your own legal research rather than getting clear advice from your attorney. This may sound outrageous (and it is) but it is not unusual.
When you should hire a cheap Sacramento bankruptcy attorney.
You should hire a cheap attorney when you absolutely cannot afford between $1,500 - $2,000 and your chapter 7 bankruptcy is fairly simple. If your chapter 7 bankruptcy case is fairly straightforward, a cheap bankruptcy attorney will likely deliver the same result as an expensive attorney. You may not get the personal attention you want with a cheap bankruptcy attorney, but you will save money in your quest to discharge debt and receive a fresh financial start.
To learn more about our Sacramento bankruptcy attorney (who is not the cheapest, but also not the most expensive) visit http://sacramentolawgroup.com/sacramento-bankruptcy-attorney/
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