Chapter 7 and 13 Bankruptcy Blog

– Victoria Ring, Colorado Bankruptcy Training

For those of you just entering the field of debtor bankruptcy, this article will be very helpful to you because it addresses a very common problem that occurs when working with debtors.  The common problem is that debtors want their cake and eat it too. This statement may sound a little harsh but allow me to explain:

I am finding that many new attorneys entering the bankruptcy field do not have the training to screen their clients before sending us the petitions for input.  One of the easiest methods for an attorney to screen their clients is to find out how much equity is in their home before taking the case. During the intake it only takes a minute or two to find out approximately how much the debtors owe on their mortgage.  Then, while the client is still in the office, go to a computer and do a search on www.zillow.com.  Although Zillow is certainly not a court authority by any stretch of the imagination, it will tell you immediately the approximate amount of unexempt equity the debtor may have.

For example: I had a case today for a California debtor who had just divorced. There was $200,000 of equity in the home.  Since the debtor was divorced, he only had to claim $100,000 of this equity.  Under the 704 California exemptions, the debtor was provided with a healthy $75,000, leaving him with $25,000 that was UNEXEMPT.  Was the debtor happy about the $75,000 exemption?  Of course not.  The debtor was angry because he wanted to keep the $25,000 plus have all his debts excused.  Although most debtors may not realize it at the time, in reality they are being unfair and asking the attorney to commit fraud by making this selfish demand.

Unfortunately, most of the new bankruptcy attorneys that I work with do not understand the bankruptcy law well enough to properly advise their client.  Instead, they accept the case, have the client fill out the intake forms, pay the fees and send the paperwork to my team.  We input the petition and discover the problem with the equity in the home.  By this time, the attorney has invested his or her time, the debtor has spent several hours gathering information and we have worked inputting the case.  When we discover this problem we alert the attorney, the attorney talks to the client and the debtor decides not file bankruptcy.  The attorney is forced to refund some of the money because the attorney did not know how to properly explain the advantages to the debtor of filing a Chapter 13 instead.  In fact, if the attorney had called to discuss this case with me, I could have taught him how to turn this unhappy client from a Chapter 7 to a positive Chapter 13 because I deal with these issues all the time.

For example, this particular debtor had $38,000 in Schedule F debts and $25,000 of unexempt equity in his home.  The debtor did not want to surrender his interest in the property because he wanted to make sure his ex-wife and children had a home to live in.  This is admirable, but the court and creditors look at numbers because they are not emotionally tied to debtors. New attorneys must learn these types of skills so they can help the debtor understand why it may or may not be to their advantage to file bankruptcy at this time.

But for the particular debtor in our scenario, it would have been to his advantage to file a Chapter 13.  First of all, we could have proposed a 100% Plan which would have more than likely protected the $25,000 of unexempt equity.  Secondly, the Chapter 13 would have eliminated $73,000 in interest charges over the 5 year Plan period, the debtor would have paid off his student loan in full as well as the unpaid personal income taxes from 2002.  By presenting these positive factors to the debtor, the attorney may have saved this case and never had to refund money.  Plus the debtor would be happier once he understood the advantages.

(Note:  A key to good marketing is to point out advantages for the client.  If you can show a client how much money you can save them and how, they often will do whatever is necessary to comply with your requests and invest their time and money making it happen.  This is what makes a happy client and this is what generates referrals.)

But in this case, the attorney did not call to discuss the matter with me.  He simply told the client that he would have to pay $25,000 or lose his home.  This naturally scared the debtor to death and he decided not to file. Who can blame him?

It amazes me when things like this happen; and they happen quite frequently.  In fact, it may be shocking to you also.  I hope so, because I want this article to be shocking enough to help to prevent this from happening to you.  Also, please understand that this article is not intended in any manner to provide legal advice.  I am not an attorney and I am not trying to predict what a bankruptcy court to do by writing this article.  I am simply trying to help you understand the concept of fairness so you will know how to better deal with situations exactly like this in the future.

I wish you the best of success and encourage you to continue learning and working hard to protect the debtor; but in a fair and balanced way.

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I receive many phone calls and emails from attorneys who ask:

1.  Who can I get to design my web site?

2.  How can I market my website?

Most attorneys still believe they need to pay a web designer thousands of dollars to design their website or spend thousands of hours doing the job themselves.   This scenario naturally would have any attorney afraid to believe they can actually design and control their own website; so they relinquish control to other companies who claim to do the job for them; often resulting in very poor responses from potential clients.

But there is a solution to this dilemma.  Within the past year, WordPress (originally intended to be blogging software) has become a very popular software to build a web site.  And building a website in blogging software also enhances and greatly improves your search engine traffic, resulting in more awareness from your clients than the national law firm directory websites can normally offer.

DO BANKRUPTCY ATTORNEYS NEED TO MARKET THEIR WEBSITE?

If your law firm serves primarily consumers seeking to file Chapter 7 and 13 bankruptcy, you may be wasting advertising dollars if you think you can find clients by solely marketing your website.  Many attorneys have invested thousands of dollars into designing a website, hoping it will bring them a lot of business, only to be extremely disappointed.

Another disappointment is for attorneys who pay web designers to design overly corporate-looking websites with moving Flash elements, convinced by the web designer that this would be the best way to attract new clients.  But unless the web designer has experience working in Chapter 7 and 13 bankruptcy law, they know nothing about who your client is and what attracts them.  So, how can the web designer build you an effective website specifically for your audience?  They cannot.

HOW CAN ATTORNEYS ATTRACT CLIENTS?

First of all, attorneys need to identify with a very important fact they already know:  Attorneys do not need national advertising of their websites.  Instead, a law firm serves the local residents of the state; therefore, your potential clients exist all around you.  There are actually a billion ways for an attorney like you to attract clients in your state and local area; but this article will not focus on this broad issue.  Right now we need to focus on developing a bankruptcy law firm website and marketing it.

Secondly, potential clients do not need to visit a website filled with a lot of bells and whistles and moving animations.  All Chapter 7 and Chapter 13 bankruptcy clients need to know are:

1.  Where your office is located. 2.  Your contact information plus a photo to know who you are. 3.  A list of the documents they need to bring with them to your office. 4.  Some basic information about filing bankruptcy. 5.  How much you charge for filing their bankruptcy petition.

This means that a bankruptcy attorney seeking to find clients in their state or immediate area, normally only needs a five page (or less) website.  A five page website like the one detailed above should not take longer than three or four hours using WordPress.  In fact, if designing websites is not your thing, your daughter, son or other relative may be thrilled to design one for you and save you the time.

Don’t believe you can have a professional website designed in a few hours by a non-professional?  Watch this YouTube video: http://www.youtube.com/watch?v=8355qaOKXC8

But before you get started, below are a few bankruptcy attorney websites you may want to research for ideas:

Cox Law Group, Lynchburg VA http://www.coxlawgroup.com/tutorials/index.html This law firm shows how effective video marketing is.  You can do the same; just sit in front of your computer with a web cam and start talking about your law firm.  Even a two or three minute video is sufficient and it will add a nice personal touch for your clients.  They will feel like they know you before they meet you.  This is an example of excellent PR and you have not spent a penny.

Don’t have time to produce videos right now?  No problem, the US Courts website has done the job for you.  In fact, some attorneys copy these videos onto DVD and use them to educate their clients while they are completing the Client Intake Forms.  Simply visit the link below and embed the video into your website: http://www.youtube.com/watch?v=KU5UDYBAFSQ See a sample of how these videos are used on the front page of this bankruptcy attorneys website: http://www.lloydcohen.com/

Joseph C McDaniel, Phoenix AZ http://www.josephmcdaniel.com/ This bankruptcy attorney has a very nice website designed for consumers.  The movement you see on the front page is the result of Flash programming, which can be expensive if you do not know how to do it for yourself.

Walter Metzen, Detroit MI http://www.detroitbankruptcylawyer.com/ This attorney has a simple looking website with only a few pages; however, if you scroll down to the bottom of the page there is a link for Law Info.  If you click on this link you are taken to the website of Law Info.  Search engines like this normally charge a very high price to design a website and host it for attorneys.  Many of them claim that by hosting on their server the attorney will get more traffic.  Again, an attorney only needs traffic from clients in the state they are licensed in, not the entire United States; which is what most internet marketers base their advertising on.

Carrie Sue Genisio, Kansas City KS http://www.lawinkc.com/serivcesBankruptcy.htm This is a very simple web page.  Notice the link titled:  Getting Ready for Your First Appointment.  Unfortunately the link to:  FORMS, does not work’ which is one reason it is important to always test your website so that you do not lose potential clients.

Marshall Cohen, Columbus OH http://www.columbusbankruptcylaw.com/ This is a website filled with content directed toward the client.  Notice how the attorney never mentions fees on the internet.  Instead, he asks clients to come in so that he can assess their situation.  All attorneys need a low fee and a high fee, depending on the complexity of the bankruptcy case.

Find More Bankruptcy Related Websites: http://chapter7and13bankruptcyblog.com/business-directory Click on the DEBTOR BANKRUPTCY ATTORNEY category

MORE TOOLS TO HELP YOU

New Video:  A preview of How to Design Your Website with WordPress http://chapter7and13bankruptcyblog.com/archives/411 For only $35, you can watch this 1 hour and 16 minute training video online.  Buy it for your spouse, son, daughter, relative for yourself to design you own web site quickly and easily at NO COST.

Free and Low Cost Marketing Links for Attorneys http://www.bankruptcylinks.info/about/marketing-links

Other Free Bankruptcy Training Videos: http://www.youtube.com/user/MsVictoriaRing