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Cheap Bankruptcy LawyerHave you noticed that most lawyer advertising is the same? Every bankruptcy lawyer brags about being the best, the toughest, the most aggressive. We all know they are just making it up.

Cheap Bankruptcy Attorneys are a Dime a Dozen

Lately I have seen there are a lot of lawyers bragging about being the cheapest. Search on Google for a mesa bankruptcy lawyer and you will see “Cheap Bankruptcy Lawyer,” “Cheapest Bankruptcy Attorney,” “Low Fee Bankruptcy Lawyer.” Any day now someone will claim to be the “Cheapest of the Cheap.” Are they really?

We all know that cheap and good don’t go together. If we buy a cheap used car we know it will cost us. We will pay a price with high repair and maintenance costs. When we go to a fast food restaurant we pay for convenience, not quality. If we eat too much of it the medical bills will more than wipe the savings.

Those aren’t surprises. We expect it and decide knowing what will happen. When it comes to hiring a lawyer I don’t believe many people decide knowing the risks.

Hidden Cost of Low Cost Bankruptcy Lawyer

A lot of my clients have visited other lawyers before coming to see me. Most of the times they have gotten good advice. There are a lot of good choices for finding a lawyer. These clients are smart and just want another opinion before making a big decision. That is not always the case.

Recently a small business owner came to discuss filing a bankruptcy. The economy over the last few years has been brutal. Although he had already hired another attorney his gut told him something was wrong. He was advised to file a Chapter 7 bankruptcy and was about ready to take that advice.

I reviewed his situation and recommended filing a Chapter 13 case instead. Compared to the Chapter 7 case he was about to file, the Chapter 13 will eliminate over $50,000.00 in additional debt. He can keep his business and other valuable personal property –things he would have lost had he filed the Chapter 7 case recommended by the “cheap” lawyer. In Chapter 13 his monthly “out go” will be less. The discount lawyer would have saved him about $1,500 in legal fees and he would not have realized how much better his situation could have been by spending a little more.

Discount Bankruptcy Cost Way Too Much

Another situation is even sadder. A gentleman filed a Chapter 7 case with one lawyer that claims to be one of the “cheapests” and bragged about it on their TV ads. He was told his case was straightforward and there was nothing to worry about. He owned a life insurance policy with some cash value and an annuity. If you look at any summary of the property protected in a Chapter 7 case you will see that cash value in a life insurance policy and annuities are protected. But, if you read the actual law you would see that not all insurance policies and annuities qualify for the protection. Apparently the cheap lawyer had not read the statutes. This gentleman lost over $40,000 in assets that could have been protected with some proactive planning. Well, he saved about $1,000 in legal fees but lost $40,000 because he did not know how risky hiring a cheap lawyer could be.

Low Fee Bankruptcy Unnecessary

As sad as those situations are, a far more common problem is when the discount lawyer is recommending a bankruptcy when it is unnecessary.

Recently a man came to visit me about filing bankruptcy because a collection lawyer was threatening to sue him for over $200,000. Both of the previous lawyers he met with recommended filing a Chapter 7 bankruptcy. A co-worker recommended he talk before deciding. He is glad he did. During our first visit it was clear he had a great defense to the lawsuit, if one was ever filed. It was and the Court dismissed it on my request. Then, we sued the collection law firm for violating the Fair Debt Collections Practice Act. The lawsuit was settled long before trial for a substantial amount (I can’t give you the details because the settlement agreement requires we keep it a secret). Not only did my client avoid the costs and problems of an unnecessary bankruptcy, but he received a substantial settlement, too.

 Quality Legal Help Pays

Not everyone with a debt problem must file bankruptcy. But, the cheap lawyers must file a lot of cases to pay for their expensive advertisements. The good lawyers will give you honest advice and search for the best solution for your problem even when it means you won’t be hiring them. I can list example after example of situations where the cheap legal advice cost many times more than the savings in legal fees.

Money is tight when considering bankruptcy. If you are tempted to find the lowest cost bankruptcy lawyer consider the risks. I am convinced that
paying a little more in legal fees will be a much better deal and far less expensive in the long run.

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Credit After Bankruptcy: Why Choose a Secured Credit Card Offer

Virtually everyone I meet with to discuss the filing bankruptcy is worried about future credit. Is it possible to reestablish credit after filing bankruptcy? It is. It might take a year or two after bankruptcy to rebuild yourSecured Credit Card After Ban credit score, but imagine how long it will take if you continue to struggle with your existing debt. One good way to start rebuilding your credit score after bankruptcy is by getting a secured credit card.

Unsecured or Secured Credit Cards after Bankruptcy?

When looking for a credit card after bankruptcy, you will receive piles of credit card offers from different companies. Choosing the right card can be a daunting task. Should you apply for a secured credit card or an unsecured credit card? Secured credit cards are often better deals than unsecured cards because the fees and interest right are usually lower that the unsecured cards you can qualify for immediately after a bankruptcy.

What is a Secured Credit Card?

A secured credit card requires a cash deposit as collateral for the credit line. Your credit limit is either the amount of your deposit or some percentage above that amount. Secured credit cards are designed for people with a poor credit score, such as bankruptcy. They may charge higher fees, but in many circumstances, they will less expensive.

Top Tips for Finding a Secured Credit Card after Bankruptcy

1.            Check the fees involved with the credit card offer, because regular payments such as annual fees or processing fees may have to be made. Remember, annual fees differ significantly between various banks.

2.            Apply for a secured credit card that doesn’t charge an application fee.

3.            Because the card is secured by a deposit, you should not have to pay a high interest for a secured credit card you get after bankruptcy.

4.            Make sure that the credit card company reports your payment history to the three credit bureaus. If they don’t, it will not help rebuild your credit.

5.            The company should not report that you are holding a secured card to the bureaus, which can adversely affect your credit score.

6.            Watch out for companies that use deceptive practices. Research the company and make sure that it does not have a history of consumer complaints.

Bouncing back from a bankruptcy does not have to be hard. My firm offers our clients free enrollment in a 14 Week Program that will teach you how to rebuild your credit the right way and how to re-establish your credit after a bankruptcy.

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Deciding on Chapter 13Why would anyone want to file a Chapter 13 bankruptcy? When you are struggling to make ends meet it may seem odd that filing a bankruptcy that requires making payments to your creditors can be a better deal than Chapter 7. It often isn’t, but here are three situations where filing Chapter 13 can save you a lot of money and aggravation:

1. Chapter 13 can save your house from foreclosure. Once you fall behind on payments it is tough to get back on top of things. When you are facing foreclosure a Chapter 13 will stop your house from being sold out from under you. Chapter 13 gives you a chance to get caught up on payments. These catch up payments can be stretched out over a five year period.

2. Get rid of a second mortgage. Chapter 7 will discharge a second mortgage. That does not do you much good when you want to keep the house. The second mortgage lien survives the Chapter 7 discharge. Chapter 13 is often a better deal. The rules are different in Chapter 13. When your house is worth less than the first mortgage, Chapter 13 allows you to discharge the second mortgage and have the second mortgage lien removed.

3. Save your car. In this town a car is a necessity for most of us. When you are behind on payments you are in danger of having the car repossessed. Chapter 7 might slow down repossession, but it won’t stop it unless you can get caught up on payments fast. Chapter 13 will allow you to keep the car and pay it off in a payment plan that can last as long as five years. Many times we are able to reduce the amount owed and have a lower interest rate set.

4. Force the IRS into a payment plan. It is hard to imagine a worse creditor than the IRS. Even if you are able to work out a payment plan with the IRS they will continue to add penalties and interest to the amount owed. Chapter 13 will allow you to pay back taxes and stop additional penalties and interest from being added.

Even when you meet the rules for filing a Chapter 7 bankruptcy there may be good reasons to consider a Chapter 13 instead. Chapter 13 will often save you money and the loss of valuable property. To learn more, give us a call at 480-820-0800 and talk to an experienced Arizona bankruptcy lawyer.