Several years ago, a fellow bankruptcy lawyer told me that our job as bankruptcy lawyers is to get our clients to tell us all of the "Dairy Queen Law" that they know. "Dairy Queen Law" is all the bankruptcy laws that the clients learned about at the local "Dairy Queen" from friends, family members, waitresses and other patrons. We have to get our clients to tell us what "Dairy Queen Law" they have learned, and then we, as attorneys, must tell them the truth about bankruptcy. Well here is some common "Dairy Queen Law", followed by the truth.
Your employer and the local newspaper will be told that you have filed for bankruptcy.
When you file a Chapter 7 case, the employer is not notified of the bankruptcy. If you choose to file a Chapter 13 case, you ask your employer to garnish your wages to pay your creditors under a court approved Chapter 13 plan that you file. Your employer is notified of the bankruptcy because you ask that your wages be garnished. This is one of the many reasons that our law firm now attempts to file as many of our cases as Chapter 7 cases.
Our local newspapers do not publish those who have filed a bankruptcy case (unless they are Donald Trump, American Airlines, Walt Disney or similarly famous people or businesses). In my 30 year bankruptcy practice, the only bankruptcy case that made the local paper was the Chapter 7 case I filed for a local micro beer brewery. The article was much more about the brewery than the bankruptcy filing.
You Have to be Very Poor to File Bankruptcy
The 2005 amendments to the US Bankruptcy Code made the forms necessary to properly file a bankruptcy case very difficult. However, we file cases for very poor individuals and other "not so poor" folks who find themselves in financial difficulty. We offer a free consultation and can help find a solution to your debt problems. Most of our clients believe that they are very distressed when they first walk in our office and leave confident that they have found a solution to their financial problems.
Your Credit will be Ruined Forever
False! Most clients that come to our office have serious financial problems and bankruptcy removes those debts and gets them on a road to a fresh start. Most of our Chapter 7 clients finance late model vehicles while their bankruptcy cases are pending. Working to restore the credit after the discharge will enable clients to finance homes beginning two years after the bankruptcy discharge. Bankruptcy is a solution to a financial problem and usually one that dramatically improves our clients credit and financial issues.
New Laws Make it Impossible to File for Bankruptcy
In 2005, the US Congress made dramatic changes to our bankruptcy laws. Sadly, the effect of these laws is only to make the price of filing a bankruptcy case more expensive for consumer debtors. The forms now required to be filed when a bankruptcy case is filed are very complicated. I actually teach continuing legal education classes in which I instruct attorneys and paralegals how to correctly prepare the forms to get the best result possible for their clients. It is very important that you hire a very experienced, knowledgeable bankruptcy lawyer to represent you in this very complicated area of the law. Millions of Americans filed bankruptcy before the law changed, and millions are filing now that the new laws have become effective.