Cheap Affordable Southern California Chapter 7 Bankruptcies – Too Good to Be True?

Posted by on May 19, 2012 in Chapter 7 Bankruptcy Issues | 0 comments

I recently saw an online advertisement for chapter 7 bankruptcy services by an attorney offering to do the work for rock bottom pricing.   The attorney’s website failed to clearly indicate specific office address locations and made no mention of any relevant bankruptcy experience or applicable bankruptcy credentials. Really the website failed to disclose much at all except the attorney’s rock bottom flat rate pricing for chapter 7 cases.

There is nothing wrong with offering rock bottom pricing. In most cases, this attorney’s services might be great. However, the attorney – via his website – was quick to infer that bankruptcy attorneys who charge more than rock bottom pricing for chapter 7 cases are just ripping people off.  That could not be further from the truth.

I believe this attorney’s intentions are good. I believe the attorney really thinks almost all chapter 7 cases are easy to prepare and are devoid of any complexity. If this attorney does think that, I believe it is due to a lack of experience practicing bankruptcy law and not being more well read on the intricacies of bankruptcy law.

I would be very concerned for a potential client who went to such an attorney for a chapter 7 case with tax issues, non-exempt assets, retirement accounts, or even a case where the debtor’s income is subject to the means test. The result might not be pretty. For example, if an attorney offers to get rid of huge tax assessments for rock bottom pricing via ch7 bankruptcy, I would just tell you to be very cautious and use your logic in choosing the right bankruptcy attorney to handle your case because it takes time, skill, and effort.

In practice, I have personally helped debtors who were in trouble because they either filed pro per (without an attorney) or they retained the lowest priced attorney they could find for their chapter 7 case.  Oftentimes, these attorneys screw up things that are very basic in nature.  However, when you screw up such fundamental things within the bankruptcy process, oftentimes there is no recourse but dismissal.  In other cases, it can lead to a loss of assets that could have been protected had the case been filed properly.

Remember not all cases are the same. Some chapter 7 cases are indeed considered simple cases by most capable practitioners. Other chapter 7 cases can be very complex. There are chapter 7 cases where no capable attorney would take the case without informing the client that the case is complex and problematic from the start just to clue in the potential client on what to expect. For those attorneys who usually offer rock bottom pricing, they are often only jumping in on the practice of bankruptcy law due to our sluggish economy, and it is far from clear what level of preparation they undertook before holding themselves out as bankruptcy practitioners.

There are many good and bad attorneys out there. Remember you more or less get one shot at your bankruptcy filing.  Make sure to do it right the first time around.  Ask about the attorney’s success rate and types of cases filed rather than just purely how many cases filed.   An attorney may have filed thousands of cases yet has a poor track record, or never handled your type of case before and lacks the resources to do so.   Unfortunately, some attorneys actually lie about their credentials and how long they have practiced law.  What is important is that you make sure you ask questions about YOUR case and get an answer to those questions before filing.  If you only get evasive answers or generalities about your case, your questions are not being answered so find a bankruptcy attorney out there who will actually answer them and choose that attorney to help you with your case.    In the end, use common sense in choosing the right attorney to handle your chapter 7 case and don’t simply go with the lowest fee approach unless you know the attorney is competent to take on your case because I have honestly seen it backfire firsthand.


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