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Tip# 7
What to Avoid
Paying too much!
Most people filing for bankruptcy will only have had one occasion in their lives to seek resort to the legal system. That one occasion is usually their bankruptcy. After years of living the right way people find that suddenly they can no longer pay their bills and thoughts of filing for bankruptcy occur. Many times feelings of guilt accompany these thoughts and people tend to exaggerate the complexity of what bankruptcy is. They often think that they need a super lawyer to get them out!
Paying too Little!
There can be a thing called paying to little. Bankruptcy cases can be complicated by issues such as lien avoidance, offers of redemption, negotiation on re-affirmation agreements. These are matters that have to be dealt with by a competent attorney who is adequately compensated for the work that is involved. If an attorney has accepted an unrealistically low fee, the chances are these issues will go by the wayside.
Large Advertising Firms!
If you've seen a bankruptcy law firm on Television or seen their name on the back cover of a yellow book then your dealing with a "large advertising firm". The practice of market saturation advertising is a business plan that simply doesn't work. the most recent example of a market saturation business plan was Kerry Steigerwalts "Pacific Law Center". Many people probably enjoyed watching their ubiquitous advertisements last couple of years on television and where surprised to learn that the firm that everyone thought was the new super firm has gone out of business. Click here to read the statements of the firms owner regarding the dissolution.
Large advertising firms in the field of bankruptcy law consistently fail and go out of business. Most people don't realize how expensive it is to advertise. For example, to place a law firm advertisement on the back cover of the AT&T directory for the San Diego Metro area cost over $400,000.00 per year and Television advertising is even more expensive than that when done on a large scale. The now defunct Pacific Law Center spent over 2 million dollars per year on placing their adds on TV. Pay per click advertising on Google can also be extremely expensive. It can cost as much as $100.00 per click for certain types of banners. In today's world you can actually buy search engine rankings and placements with money.
Who pays for this advertising? Well, you do, if you hire this firm and are planning on filing a case under Chapter 7. You will necessarily end up paying your pro-rata share of the advertisement you just watched on TV out of your bankruptcy fee's. That's how a bankruptcy law firm pays their bills, with your money, there is no other source!
Are there other downsides to hiring a large advertising firm? Yes! it is well known fact amongst the legal professional that law firms and attorneys involved in a market take over bid through advertising must accept every single case that walks in the door and try to get as much money as they can from every single client in order to pay their bills. Click here to read the statements of Kerry Steigerwalts regarding the demise of the Pacific Law Center. This often results in dishonest practices with the client due to economic necessity.
How do I know if I'm dealing with a large advertising firm?
Today's Chapter 7 bankruptcy costs an average of $1500.00. This is a normal and reasonable fee, although some firms including ours will discount simple chapter 7 cases for moderate income clients down to around $750.00 and put you on a payment plan that will allow you to file your case now. If your agreeing to pay $2,000 or more for a simple chapter 7 case, your paying way too much and you are probably the victim of a get-rich quick scheme by a law firm engaging in a market take over bid.
