Questions and Answers

Bankruptcy Attorney HelpLine

Colorado Bankruptcy Training and Virtual Petitions have teamed up to offer bankruptcy attorneys the convenience of a HELPLINE.


At any point during the intake process and even pre or post petition, you or a member of your staff can contact us with any questions regarding Chapter 7s and 13s. This contact can be made by email or telephone; whichever is convenient for you.  We will then do our best to answer the question or assist you in any way to solve the issue.

BONUS:  And during the process, we will train you in a variety of skills so that you eventually never need us.

Sonya and I decided to initiate this service because we are finding that most attorneys open up new bankruptcy practices without any prior knowledge of the intake process. In law school, attorneys are trained in the law, not the process that most paralegals perform.

Within the past month we have had four attorneys ask if they could call us to discuss their cases to gain insight from our combined 37 years of paralegal experience.  And this is why we decided to announce the service to our LinkedIn members to see how popular the service is received.


1.  Email your name, law firm name, address, city, state and zip, telephone and email address to  PAY NO MONEY UPFRONT.  (We provide the service and bill you after 30 days. There is NO RISK on the attorney’s part whatsoever.)

2.  Next, call or email the HelpLine when you have a case or issue regarding a Chapter 7 or 13 case.  Remember, we are not attorneys and we cannot provide legal advice. But we do have a wealth of knowledge in Chapter 7s and 13s that we enjoy sharing with attorneys so that the law firm prospers and the client receives the best benefits that bankruptcy can offer them. Monday through Friday HelpLine: Morning Shift: Sonya Banks 6:00 am to 12:00 noon PACIFIC time: 770-601-4730 Evening Shift: Victoria Ring, 12:00 noon to 7:00 pm PACIFIC time: 719-465-2442

3.  At the end of the month, we will provide you with a detailed invoice containing the clients’ name with a summary of our discussion.  You are billed at the rate of $125.00 per hour which is about half of what other on-demand support services charge.

If this is a service you do not need, please forward it to a new attorney who may benefit from the HelpLine.  Sonya and I have a passion for the debtor and we enjoy working with attorneys who feel the same way.  We hope to work with you and your staff soon.

Victoria Ring Colorado Bankruptcy Training

Questions and Answers from Bankruptcy Professionals


I would love to enroll in your Chapter 7 class starting on July 5, but I may not be able to attend all the classes.  Do you give credit for any classes that I miss?


Yes, when you enroll, any classes that you miss will be credited to you.  We will assess this on a case-by-case basis, depending on the number of classes you missed compared to the number of classes you were able to attend.  However, regardless of the outcome, you will receive full credit for all the classes when you enroll.

To enroll for the first class beginning on July 5, visit: DEAR VICTORIA I had a question regarding illegal immigrants. I have a pro bono client that has been using a made up social security number for 10 years. He just informed me that the social is not valid and he is in the country illegally. Under the federal rules there is no explicit law stating that he has to be a citizen however I know at the 341 meeting they will ask for a valid social security card. Any thoughts?


An illegal alien cannot file bankruptcy. To be truthful, I would immediately report this person to the authorities.  I personally think what this client is asking of the United States is a total outrage and I encourage you to get him or her out of your life immediately.  People like this do nothing but cause havoc within the system because they have spent years taking advantage of the United States.  This illegal client should have obeyed our laws and got a green card many years ago.

Again, I think this is an outrage and total abuse of the system if this client can even conceive trying to take advantage of our laws simply because he cannot pay his bills.  I doubt he ever paid taxes to the United States because he worked illegally in our country for 10 years and now he wants more?  This is not fair, let alone right!!!


Thank you. I completely agree with you. I received the client from a public law center in Orange County that was supposed to prescreen clients. The client gave me his phony social and then called me a week later to inform me that it was made up.  I was not sure if I had a legal obligation to continue to represent him however I actually just spoke to him and informed him that I have to withdraw and that he is committing fraud. It is amazing how long he was able to use a false social for employment and credit. Again thanks for your help.


Back in the old days when someone went to an attorney to file bankruptcy, they normally needed to file bankruptcy.  It was not a wonderful thing to do.  Most people felt very bad that they had to file.  But today, people look for loop holes in the bankruptcy law so they can take advantage of the system.  This is sad, and it means that honest people need to get wise in order to prevent as much fraud as possible.  If we do not fight for the prevention of fraud, the innocent people will suffer.

One way to prevent fraud is to use the tips in my latest video, which you can view online at:


A little over a decade ago, attorneys were not permitted to advertise.  But today, attorneys have the right to do so.  The problem is that many attorneys have no clue about marketing.  Is this a subject you teach?


I incorporate marketing skills training when I set up operational procedures for law firms.  It is my personal belief that marketing needs to be a part of the day-to-day life inside the law firm.  From the person who answers the telephone to the attorney sending an email to the client; all methods of marketing must be implemented in order for them all to work together for the benefit of the law firm.  In this manner, marketing is free or very low-cost.  Personally, I do not think it is a good idea to pay others to market your website.  With all the fraudulent marketing schemes out there; it is more advantageous to do the job yourself and control the entire operation.  This way you can also fine tune your law firm income and adjust methods as necessary.  No hired marketing firm is going to do that or care that much for your law firm.


Free: Add Your Website to Our Directory

Free and Low-Cost Marketing Links for Attorneys

Free Stuff to Reduce Your Office Overhead Costs

Free Ebook: How to Start a New Bankruptcy Practice

Free Training Videos – Watch Online Now

Helpful Links When Preparing Bankruptcy Petitions Prequalify Your Debtors with the Initial Intake Form Product

Questions from Attorneys Regarding Bankruptcy Petition Preparation

The following questions were submitted by bankruptcy attorneys during the past week. The answers are provided by Victoria Ring who is not an attorney.  Therefore, the information provided in this material is for training purposes only and no whole or part should be conceived as legal advice.


I am a new attorney doing my first bankruptcy petition where I am proposing a cram down.  The appraised value of my clients home is $185,000.  They owe $170,000 on the first mortgage and $45,000 on the second.  How can I do a cram down?


You cannot do a cram down.  A cram down is when the house is worth LESS than the amount that is owed.  The amount that is owed is crammed down to the appraised value.  In your clients case, the opposite is true.

Perhaps it will help you to understand the concept better if you think of it this way:

If the house had to be sold and it sold for $185,000; there would be plenty enough money to pay off the first mortgage of $170,000. In fact, you would have $15,000 left over after the sale and the pay off.  Therefore, a cram down is impossible to do since there is nothing to cram down.

However, on the second mortgage, you may be able to propose a reduction since there is only $15,000 left.  Instead of the client paying $45,000, they may only need to pay $15,000 on the second mortgage.  The remaining $30,000 from the second mortgage is actually unsecured equity.

But let us not forget the exemption allowance provided for by your state.  If the exemption allowance is $50,000 the figures change for both mortgage companies.  Therefore, I would need to review Schedule A of your clients petition in order to determine the different strategies available in this particular case.


How can I find the IRS Guidelines so I can accurately calculate Schedule J of the bankruptcy petition?


The main page of links I put together to help you when preparing bankruptcy petitions is at:

The links to the IRS guidelines are at:,,id=104627,00.html,,id=104696,00.html,,id=104623,00.html

Keep in mind that the government wants you to think outside the box.  Many of the guidelines are lumped into categories that are not consistent with Schedule J.

The only purpose in reviewing the IRS guidelines and comparing them to the Schedule J figures the clients provide is to make sure the figures are accurate.  For example, gasoline prices fluctuate from week to week.  If the clients tell you they spend $200 a month on gas this month and the IRS guidelines allow them $800; it is an indication that the client may have provided you with a wrong figure and you should ask them to provide a more accurate one.

Why is this important? Because if you give your clients a Chapter 13 Plan payment they cannot afford, they will be unable to stay in the Chapter 13.  This escalates costs as well as other problems for attorneys, clients and the bankruptcy court.

However, this is not a skill that you learn preparing one bankruptcy petition.  This is why I incorporate the training of this skill when I train attorneys.  Believe me, I did not learn the skill overnight myself.


The liquidation analysis says that the unsecured debts get nothing but I am not sure how to adjust for that since the plan wants to automatically pay them. Do I use: not in plan, for each to stop the computation?


Unsecured debts should NEVER be removed from a Chapter 13 Plan.  That is one of the main purposes of filing a Chapter 13 in the first place.  The solution is not to trick the software into not calculating unsecured debts.  The solution is to fix what you did wrong and make sure that the unsecured creditors are paid a minimum percentage.  The minimum percentage varies from state to state.  In California, attorneys can have as low as a 2% Plan but in Ohio they never allowed any Plan less than 10%.  As an attorney, you need to call the Chapter 13 Trustee’s office or consult with an experienced attorney in your area to find out the minimum Plan percentage accepted in your state.


When you switch from a Chapter 7 to a 13, why does the dialog box come up in the software asking if you want to change your answer on funds available to the unsecured creditors? Are you supposed to have funds in a 13 and not for a 7?


I assume you are referring to the Voluntary Petition.  There are two checkboxes on this form with the following two choices:

Box 1: YES.  Debtor estimates that funds will be available for distribution to unsecured creditors. Box 2: NO. Debtor estimates that, after any exempt property is executed and administrative expenses paid, there will be no funds available to unsecured creditors.

Yes, your assumption is correct.  If there are no funds available to pay unsecured creditors, the debtor is filing a Chapter 7.  One of the requirements to file a Chapter 13 is that there is money left over to pay unsecured creditors.  Besides, if there is no money left over, how could the debtor be filing a Chapter 13 anyway?  They would have no Plan payment to make if they have no money left.  This is a Chapter 7.


Where, if anywhere, are there widely accepted interest rates for the secured debt published?  Is this an area where there are lots of disputes?


I called an attorney in California to get a good answer for this question.  The attorney told me this: The interest rate currently paid by the debtor should be used on secure debts unless it is excessive.  To have figures to compare she suggested you find out the average percentage people with good credit pay to purchase a new home (or other asset) in your area.  Suppose you find out this percentage is 2% but the clients are paying 27%.  This is excessive; and in bankruptcy, you may consider proposing the 2% instead of 27% and hopefully there will be no objection from the mortgage company.


With all the information you know about bankruptcy and law firm operations, do you plan to publish a book?

ANSWER Yes.  Two attorneys in Georgia (J. Jeffrey Williams and Patricia Lyda Williams) and myself are putting together the materials now.  The name of the book will be: What They Did Not Teach You in Law School About Chapter 7 and Chapter 13 Bankruptcy.  We hope the book will be ready for sale within 90 days.


I am a California attorney. If I attend your web training seminar how many MCLE credits do I receive?


The MCLE credits permitted by the State of California are only for seminars that you physically attend. MCLE credits are not provided for the web training seminars I develop and offer to help your law firm.  Besides, the purpose of the web training seminars Michael and I provide is to teach you skills that will improve your bottom line and help you to have a well run and organized law firm.  If we have to force attorneys to attend our seminars through the lure of giving them credits, I really do not think those attorneys would appreciate the training they receive.


If you are a new bankruptcy attorney, spend 1 hour with me online and I guarantee I can help solve many problems with your petitions that you are encountering. The cost is only $100 for a full hour and we meet via a web meeting. This means that you will login to the internet and be able to view my computer screen.  This way, I can provide you with visual training, which has more impact than talking solely on the telephone.

Call 719-465-2442 or email to schedule your training.


Check us out for only a $25.00 investment. Attend the June 5, 2010 Bankruptcy Cram Down Web Training Seminar.  Sign up at:

If you have any questions you would like answered in this forum, send them by email to Your name or contact information will never be used unless you specifically request it.  And if I do not know the answer, I will ask an attorney and get an answer for you.

Have a wonderful week.