There is a new marketing trend sweeping through the Bankruptcy Bar involving attorneys who will take on bankruptcy cases, even lend their clients filing fees, against the prospect of being paid after the case is filed. There are even companies lending those attorneys money against those fees and then getting repaid as the attorney gets paid after the filing.
These schemes are a bad idea for a couple of reasons:
- There is no statute that actually supports this type of arrangement.
- Encouraging a Debtor to get out of Debt, with the idea that the Debt relief itself is tied up in Debt is bad psychology.
When people get in over their heads, bankruptcy can, and often should, be the right solution to give them a fresh start and get back on their feet. But, in order to have the bankruptcy process result in a positive effect they must first take control of their money.
Discontinuing minimum payments against debt, the next most common source to funding a bankruptcy after family help, is not going to make the bankruptcy worse, harder, or less effective. But, believing that just signing some papers makes your problems go away without any real behavior modification will make the post-bankruptcy situation worse.
Almost no one who needs, and can use bankruptcy to an advantage, can’t save up enough to actually pay a bankruptcy lawyer before they file. Think carefully about whether perpetuating the idea of kicking the can down the road instead of facing your problems head on is really the best thing to do.
This article is written by an attorney at Attorney Donald Wyatt PC. Always consult an attorney before making any legal decisions. To make an appointment today for a free consultation, please click here to contact us.