Re: Bankruptcy Filings Rise

More | Report Post

Thanks for the good feedback. I'm evaluating work options right now - in
a few years, at least, I'd like to be on my own, and BK has always
interested me.

On 3/31/06, FordhamGrad wrote:
> On 3/30/06, Dante wrote:
>> Question: I understand that the new law only applies to half the
>> population - namely, those that make more than the median income of
>> their particular state. This being the case, are any attorneys
>> charging these clients the same fee as before? Or are the new fees
>> hiked for everybody?
>>
>> And as a side thought, since poorer people are presumably more
>> likely to go bankrupt, would it be safe to say that the majority of
>> potential clients are not impacted by the new law?
>>
>> Answer: Bankruptcy law is no longer for amateurs. Please do yourself
>> a favor and work with someone who does this for a living. The result
>> of messing it up, which is now fairly easy to do, could be huge
>> professionally. Check out membership in the ABI if you're seriously
>> considering BK practice. Liability coverage is more expensive, so
>> everybody gets charged about twice as much as before. This is the new
>> reality.
>>
>> Poorer people tend to be "judgment proof," i.e., you can't get blood
>> from a stone. When I first started doing BK about 10 years ago, I
>> figured that the target market was the poor; it is not. It is the
>> working poor, formerly known as the lower middle class, who comprise
>> the client base. Everyone is impacted by the new law. I had to turn
>> someone away today because they couldn't afford my fee. It was a lose-
>> lose result that wouldn't have happened 6 months ago. But keep a
>> positive outlook. Opportunities are rarely handed to us on golden
>> platters. There is always room at the top. It's the bottom tiers of
>> the practice that are crowded.
>>
>> Good luck.
>>
>>
>>
>>
>>
>> On 3/28/06, FordhamGrad wrote:
>>> Question: I understand that the new law only applies to half the
>>> population - namely, those that make more than the median income of
>>> their particular state. This being the case, are any attorneys
>>> charging these clients the same fee as before? Or are the new fees
>>> hiked for everybody?
>>>
>>> And as a side thought, since poorer people are presumably more
>>> likely to go bankrupt, would it be safe to say that the majority of
>>> potential clients are not impacted by the new law?
>>>
>>> I'm not practicing yet, just curious.
>>>
>>> On 3/28/06, Dante wrote:
>>>> I admire the optimism of both Jiff and rrr to predict the future
>>> of
>>>> bankruptcy. What do we really know? The practice area has now
>>>> dropped off a cliff in terms of business. Will this trend
>>>> continue? The U.S. household savings rate is the lowest ever.
>>>> Housing prices are the highest ever, and oil is now over $60 per
>>>> barrel. Add into that an aging population, foreseeably massive
>>> tax
>>>> increases both at the federal and state level, and the financial
>>>> picture darkens.
>>>>
>>>> Short-term, our business looks bad; over the longer haul, one has
>>>> to think that there's hope. I am told that the Chinese character
>>>> for "crisis" and "opportunity" is the same.
>>>>
>>>> We are diversifying over the short-term, and keeping an eye on the
>>>> long-term opportunity for consumer liquidations that is sure to
>>>> arise in the deepening morass that is our national economy.
>>>>
>>>>
>>>>
>>>>
>>>>
>>>>
>>>>
>>>> On 3/28/06, Jiff wrote:
>>>>> I admire your optimism, but I just don't see it that way. The
>>>>> problem I see with your analysis is that you assume debtors are
>>>>> actually going to defend against collection suits. In reality,
>>>>> they don't, not in large enough numbers to make it a viable
>>>>> practice add on. As far as independent paralegals, they never
>>>>> really took hold in my area, and as far as easy, cheap work,
>>>>> attorneys were more than happy to do it. Client comes to me and
>>>>> offers $400-500 for about 2 hours (at most) of my time for a
>>>>> simple 7, and I take it happily over and over again. Well, I
>>>>> used to, under the old law. I share the sentiment voiced by
>>>>> others on this board that bankruptcy's glory days are behind
>>>>> us. It was the easiest money I ever made, now, back to those
>>>>> pesky divorce clients!
>>>>> On 3/28/06, rrr wrote:
>>>>>> On 3/28/06, Jiff wrote:
>>>>>>>
>>>>>>> Read these thoroughly. Bankruptcy filings are "rising", but
>>>>>>> from virtually nothing. The current and projected caseload
>>>>>>> for the next twelve months will not support the current
>>>>>>> number of bankruptcy attorneys. 2/3 of the bankruptcy
>>>>>>> attorneys will go out of business in the next year, in my
>>>>>>> view.
>>>>>>
>>>>>> I think its going to push the Independent Paralegals out of
>>>>>> Bankruptcy business since they were the ones doing most of the
>>>>>> fast & easy petitions (at least they were the ones here in
>>>>>> California). I've already seen it in the local advertising.
>>>>>> Not a Paralegal advertising for BK at all. The Attorney
>>>>>> who "occassionally" did a bankrutpcy will no longer do them,
>>>>>> and the mills will have to change their methods, but the core
>>>>>> Debtor-Consumer Attorneys are going to come out ahead. And we
>>>>>> haven't even started to see the fallout from the slow down in
>>>>>> real estate and consequences from aggressive mortgage lending
>>>>>> practices. When the foreclosures start to hit in a stagnant
>>>>>> market, it will be time to feed again. Not to mention there
>>>>>> will be more Collections Defense Litigation from those who
>>>>>> can't Chapter 7 because of the Means Test and lack the
>>>>>> financial stability to Chapter 13, and have no foreclosure to
>>>>>> prevent. This new law may actually be great news for Debtor-
>>>>>> side Practitioners after we shake off the immediate mental
>>>>>> shock and adapt to the change. Time to be patient and time to
>>>>>> be visionary, the greedy shylocks might have just made us all
>>>>>> rich.