If you think Bankruptcy is a possibility, hopefully you have spent some time identifying one or two good lawyers in your area. The next step is to schedule an initial consultation to review your situation in more detail. These consultations are a two-way street. The lawyer is providing valuable information to you, and you have the opportunity to meet the lawyer who may be handling your case to make sure you are comfortable with the lawyer. Note that I am referring to a meeting with the lawyer who would be handling your case. If you arrive at the office and a paralegal or assistant shows up in the conference room, or a young lawyer you will never see again (often called “intake” paralegals or lawyers) meets with you just to fill out forms, it is your first red flag. The way to avoid this situation is when you call the lawyer’s office to schedule the appointment, speak with the lawyer (even if they have to return the call later) and ask the lawyer if he or she is the lawyer who will be handling your case from beginning to end. If you do not get a clear answer (or worse, a sales pitch that avoids an answer), you probably should move to the next call.
That said, what do you need when you arrive for the first meeting? I typically ask that clients bring in a short summary (usually one or two pages) of 1) their valuable assets (home, real estate, vehicles, boats, etc.); 2) the value of each of these assets and the amount of secured debt for each item; 3) the approximate total amount of unsecured debt (medical bills, credit cards, store accounts, etc.); and 4) a summary of the income of all adults in the household for the last six months. Like many lawyers, we have a short form you can use for the information. Arriving in the office with this basic information not only saves a considerable amount of time in the meeting (allowing us to move into greater detail of the case), it prompts our clients to start gathering all of the documents and information that will be necessary if a Bankruptcy case will be filed. This is, by no means, all of the information necessary to file a case. However, it is enough to start a meeting and thoroughly discuss a client’s financial situation and a plan moving forward. This also allows clients to prepare for more than one consultation with potential lawyers.
During the meeting, I will normally begin with a discussion about the most important issue for most clients – their home (if it is owned). Based on the value, outstanding debt, budget, and number of payments missed, what are the options for keeping the home? If Bankruptcy will be filed, will a Chapter 7 or Chapter 13 be the best option? Is it a good idea to reaffirm a debt? What are the realistic chances our client will be able to keep the house after the case is over? For our clients who own a home, this is normally the primary focus of the initial meeting. We will also have a similar discussion about vehicles and other valuable assets, such a rental homes, boats, RV’s, and other items. We will discuss pending lawsuits and judgments, child support or property settlement obligations to or from an ex-spouse, student loans, and any recent transfers of money or property to relatives or others. We will normally run a preliminary “Means Test” to see if our client qualifies for a Chapter 7 or whether we can prepare a feasible Chapter 13 plan. Throughout the meeting we will discuss the process of filing a Bankruptcy case and getting through the case. If a Bankruptcy case needs to be filed, I will provide our client with a longer and more detailed worksheet, and review the information requested, so we can begin preparation of the Bankruptcy forms and schedules.
While this is an example of the “normal” initial consultation, every client’s situation is different. Some clients do not own a home, and may be more concerned with protecting their small business. Other clients may need to file for Bankruptcy, but have to wait because they gave a significant gift to a child before their financial situation changed for the worse. The process also presumes that it is not an emergency situation, such as as imminent foreclosure. In those cases, we typically move straight into a determination of what can reasonably be done to avoid the consequences.
My goal is to end the meeting with the client having a solid understanding of the Bankruptcy process, whether they need to file, the pros and cons of filing, and what they need to do prior to filing. I may ask for more information, such as divorce decrees or pleadings from lawsuits, and plan a follow-up discussion. Clients often have follow-up questions after the meeting, which I am happy to answer. They may also meet with another Bankruptcy lawyer. A Bankruptcy case is one of the more important steps a person can take in their adult life, and the initial consultation is a very important part of the process for both the lawyer and client. If you are in the Atlanta area or in Georgia, please contact us to set up a free initial consultation.