Bankruptcy Saves The Bull From Sheriff’s Sale

Five years ago, Golf Digest named The Bull at Pinehurst Farms, located in Sheboygan Falls, one of the top 70 public golf courses in America. This year, the Jack Nicklaus designed course was almost sold at a sheriff’s sale. The sale was called off minutes before it was scheduled to start because the course’s owners filed for Chapter 7 bankruptcy.

How Did Filing for Bankruptcy Save the Golf Course?

The Sheboygan Press is reporting that a minority owner of the course is attempting to pull together enough financing to buy it. Filing for bankruptcy gives the potential buyers more time to put together a deal. “Richard Hahn — the attorney for The Bull’s creditor, Wisconsin Bank & Trust — said that The Bull and its owners have been unwilling to pay what is actually owed on the loan. The default on the loan is around $4.2 million, but Hahn said the owners are willing to pay about half of that. That won’t cut it for the bank, he said.”

It will be interesting to see what happens to this course for several reasons. 

First, we are seeing several courses in Wisconsin close due to golf’s declining popularity. Younger folks find the game too slow, long, and expensive. This is changing the golf industry in a big way. 

Due to golf’s decline in popularity, it is going to be harder for developers to get financing for golf course building and development. This puts a crunch on the middle of the market. We’ll always have the American Club on one end of the spectrum, and mini golf in the Dells on the other, but what will be left for the rest of us? This is the second reason it is going to be interesting to see what happens to The Bull. 

Finally, this is a very public example of one of the ways Chapter 7 can be used by business owners to help them hold on to their property. In this case, a minority owner is looking for financing in order to buy the property from the majority owners and current creditors. This is not an uncommon occurrence. Business owners frequently use Chapter 7 to get a fresh start or, as in this case, buy themselves some time to get their financial house in order. 

Individuals can also use Chapter 7 as a sort of financial reset button. While Chapter 7 bankruptcies are often called liquidation bankruptcies, when an individual files under this chapter it is more about wiping the slate clean of debt than getting rid of excess inventory, property, or contractual obligations. 

Who can file for Chapter 7 Bankruptcy? 

The ideal Chapter 7 candidate will have primarily unsecured debt (ex. credit cards, medical bills, utility bills, payday loans, etc…) and be current with any secured debt payments such as mortgage and car/lease payments. If this is the case, the individual will typically be permitted to exempt (or keep) most of their personal property. 

Our firm files a lot of Chapter 7 bankruptcies, for both businesses and individuals. If you are in financial trouble, and think bankruptcy may be in your future, let’s talk. Contact us today to schedule an initial consultation. 

New Rules For Small Businesses Who File Bankruptcy Under Chapter 11

When Goldilocks enters the home of the three bears, she searches for creature comforts that are “just right” for her. Her story involves a lot of trial and error — not to mention breaking and entering, and risking the wrath of a family of bears — but children who hear the tale are delighted when she finds something “just right.” There’s something inherently satisfying about finding the right fit after a quest that children are quick to latch on to, and the morally ambiguous tale gives them permission to compare, contrast, and find things in this world that are “just right” for them. 

Until recently, small businesses going through the bankruptcy process were like a bunch of frustrated Goldilocks who never found anything “just right.” Filing under Chapter 7 meant liquidating assets and shutting down while filing under Chapter 11 often proved too cumbersome or expensive to manage. 

A new federal law, The Small Business Restructuring Act of 2019 (SBRA), which is also being referred to as Subchapter V, has created a new bankruptcy process designed to be “just right” for small businesses. 

Understand SBRA

The SBRA fast-tracks the bankruptcy process and allows for far greater flexibility in negotiating restructuring plans with creditors. It also specifies that a trustee will work with the small business debtor and its creditors to facilitate the development of a consensual plan of reorganization. 

It is the role of the trustee that makes the SBRA process really different from other chapters of the bankruptcy code a business can file under. The trustee is supposed to take a very hands-on role, much like that of a trustee in a Chapter 12 or 13 case filed by an individual. 

According to the Department of Justice, it has hired around 250 of these trustees so far. “These trustees offer a diverse set of business, accounting, turn-around management, and legal skills.  In addition, the USTP developed a comprehensive manual and handbook to guide staff and subchapter V trustees in carrying out their new SBRA responsibilities; provided extensive training to staff, subchapter V trustees, bankruptcy professionals, and others interested in the new law; and coordinated with the bankruptcy courts on administrative issues to ensure a successful implementation.”

Small Business Debtor

Only a “small business debtor” may elect to proceed under the SBRA. A small business debtor may be an individual, partnership, or corporation that: 

  • Is engaged in commercial or business activities;
  • Has no more than $2,725,625 of total debt; at least 50% of which must be from the business or commercial activities; and
  • The debtor’s principal activity cannot be a single-asset real estate operation.

A debtor that meets these criteria may voluntarily elect to file under Subchapter V of Chapter 11. 

At Hanson & Payne, we are eager to help small business clients who feel this new process may be “just right” for them. If you would like to schedule an initial consultation to talk about the benefits of the new SBRA bankruptcy process or discuss other options available to your business, please contact us.

The $10 Million Car At The Center Of A Wild Wisconsin Supreme Court Case

Last year we blogged about a pending Wisconsin Supreme Court case involving a rare car stolen from a Milwaukee factory. The case was recently decided, and the ruling is going to have a big impact on other replevin actions filed in Wisconsin. 

Replevin Recap

As we explained in our previous blog post, replevin is a legal action. It is brought by a plaintiff who believes the defendant has wrongfully taken or failed to return a piece of personal property — which means any sort of thing except land. The plaintiff wants the property back, and may also want paid damages for the hassle of getting their property back.

At Hanson & Payne, we are often involved in cases where a replevin action is filed. We work to get the disputed property into the rightful owner’s hands. We have represented both debtors and creditors in replevin cases.

The Talbot Lago

It is rare that a replevin case goes all the way up to the Wisconsin Supreme Court, the highest court in the state, so we have been closely following the case Mueller v. TL90108 LLC. It does not hurt that the case sounds like a cross between a Bond movie and a John Grisham novel. 

In 2001, thieves broke into the old Monarch Plastic Products factory on Milwaukee’s lower east side and stole a disassembled French sports car that its elderly owner had been trying to restore since 1967. The car, a 1938 Talbot Lago T150 C teardrop coupe, was worth an estimated $7 million.

Not only was the car stolen, so were all the documents and spare parts related to it. Other valuable items in the factory-turned-garage were not touched. There was no sign of forced entry, but in a sinister turn of events, the phone lines to the owner’s house were cut the same day the car was stolen.

In 2005, the car’s owner passed away. He left his entire estate, including the rights to the stolen car, to his cousin, Richard “Skip” Mueller. A few years later, Mueller sold a majority share of the right to own the car to Joseph L. Ford III, who has experience tracking down rare stolen cars.

Then things went quiet, and it seemed like the car was gone forever. But in 2016, the authorities alerted Mueller and Ford that someone was trying to title a now completely restored Talbot with the same chassis number in Illinois!

Mueller and Ford demanded the return of the stolen car, but the man who had purchased it, Rick Workman, refused. Workman claims he had no idea the car was stolen. He purchased it in good faith from a European dealer.

In February 2017, Mueller and Ford filed a replevin action against the company Workman used to purchase the car, TL90108, LLC.

It’s a case that fits the definition of replevin to a T. Mueller and Ford, the plaintiffs, are the rightful owners of a piece of personal property, the Talbot Lago. They are suing the defendant, TL90108, LLC, for the return of the vehicle.

Lower courts couldn’t agree on what should happen to the car. Wisconsin’s replevin statute gives plaintiffs a six-year window to file a case, and the various parties had different ideas about when that six-year countdown should begin. The Wisconsin Supreme Court agreed to take the case and clarify when the clock starts ticking in replevin cases. 

What The Court Said

The Court ruled that the six-year clock started ticking when Workman purchased the Talbot Lago through TL90108, LLC in 2015. 

According to the ruling, the trigger is the beginning of the wrongful detention by a defendant, not the original theft, not the plaintiff’s discovery of the defendant’s possession of the item, and not the timing of the plaintiff’s demand of the item’s return. 

What This Means 

This case is going to be important because it opens the door for people like Mueller and Ford, who lost track of the property that was taken from them for a number of years, to bring a replevin action once the property is rediscovered. 

For creditors, or anyone that handles the sale of second-hand goods or repossessed goods, this case underscores the importance of ensuring the property you are claiming is rightfully yours. You open the clients you transfer repossessed or second-hand property to up to liability if the item you are transferring does not have a clear title. 

Our firm will continue to be involved in replevin cases, representing both debtors and creditors. We doubt we will ever see a case as wild as this one, but we do expect to cite this case going forward. If you think you have the makings of a replevin case on your hands, don’t hesitate to contact our office

Got Milk? Markets Push More Farmers & Food Processors Into Bankruptcy

The Milwaukee Journal Sentinel reports that sales of milk as a beverage have barely risen since 1985. Part of that is due to increased competition. “Beverage companies, seeking to please a multitude of palates, flooded the market with sports drinks, energy drinks, plant-based sodas, fruit juices and designer coffees… Just in the last half-dozen years, the average grocery store has added nearly 600 new beverage options to its coolers and shelves…” 

The result is a glut of milk and a corresponding drop in milk prices that are driving family farms and food processing companies that specialize in dairy products out of business. 

Wisconsin’s Dairy Herd Dwindles, Farmers Are Filing for Bankruptcy More Often

Numbers released by the Wisconsin Department of Agriculture, Trade, and Consumer Protection showed the Dairy State lost 10% of its herds in 2019 alone. Some farmers are simply closing up shop, while others are being forced to file for Chapter 12 bankruptcy

Chapter 12 is a special chapter of the bankruptcy code that was enacted specifically so that “family farmers” and “family fishermen” can file for bankruptcy without losing all their assets and giving up their way of life.

Chapter 12 bankruptcies are like Chapter 11 or Chapter 13 bankruptcies in that the goal is to reorganize operations and repay debts on a payment plan. However, Chapter 12 is simpler and less expensive to file under than Chapter 11, which was designed with large corporations in mind. Compared to Chapter 13, Chapter 12 is better at dealing with the large debts and less predictable income that characterize family farming and fishing operations.

At Hanson & Payne, we are helping several farming families in Southeast Wisconsin determine what the best path forward for them may be. We don’t push our clients to file for bankruptcy. We lay out all of the available options and discuss the pros and cons so our clients can make the decision that is best for them.

Food Processors Are Also Facing Bankruptcy 

In the last few months, two major milk buyers have filed for bankruptcy — Borden Dairy Company and Dean Foods. As we have often said on this blog, one bankruptcy can often cause a chain reaction. 

The farmers Borden and Dean bought from must now find new buyers. Companies that depended on Borden and Dean products must now find new suppliers. A delay could cause financial distress on either end of that chain. 

If Borden and Dean are unable to make payments to their suppliers, they may end up pushing others toward bankruptcy. 

At Hanson & Payne, we are skilled at working with businesses that have a disruption in their supply or customer chain. If your business is in this situation, we can help you find a path forward. That path does not have to include bankruptcy. Our firm is skilled at negotiating workouts and working with commercial lenders. 

Moo-ving Forward 

The milk market is undergoing a lot of changes right now, but in the long-run, Wisconsin will always be America’s Dairyland. Our firm is ready to help farmers, food processors, and others in the dairy industry move forward and adapt. If you need assistance in this area, please contact us to schedule an initial consultation. 

Shopko Optical Is Thriving Post-Bankruptcy

Shopko stores are gone, there’s no more Shopko gate at Lambeau Field, yet Shopko optical lives on. How is this possible? Dividing up or selling off parts of a business is a common practice in the bankruptcy courts. 

When Shopko filed for bankruptcy last year, its plan was to downsize, reorganize, and regroup while remaining in business. To that end, the company filed for bankruptcy under Chapter 11 of the bankruptcy code

What Is Chapter 11?

Chapter 11 is used by companies who are not ready to throw in the towel just yet. While a Chapter 11 case is pending, a filer has the freedom to attempt to negotiate new contracts with creditors, landlords, and labor unions. It may also settle pending litigation if it is facing unknown liability. The fear that the business will completely shut down if negotiations are unsuccessful gives the filer some leverage and motivates everyone to make a deal. 

Contrast this with a Chapter 7 bankruptcy, where the goal is winding down operations. Assets are sold off, creditors paid whatever is possible, and then the business is shuttered. There is no attempt to keep the business going, even though parts of it might be profitable if they are sold off.

Why Did shopko file for bankruptcy

Shopko was unable to find a way to restructure its business so it could be successful going forward. It’s only choice was to shut down. It ended up being more like a Chapter 7 case than a Chapter 11 case. 

While Shopko as a whole was going through the bankruptcy process, Shopko Optical was spun off as a separate entity. The people who worked in these locations kept their jobs, and the patients kept their access to care. It is a bankruptcy success story. And it is not an unusual one. It is common for bits and pieces of businesses to be bought and sold while their parent company is going through the bankruptcy process. Some businesses will file for bankruptcy just for the flexibility it gives them to restructure in this manner. 

How We Can Help You

Our firm frequently helps Wisconsin business owners sell or acquire a piece of a larger company. We have helped negotiate such sales, and done due diligence checks for buyers, sellers, and commercial lenders. We also have extensive experience protecting the interests of lenders in these situations. At the time a commercial loan is written, we anticipate problems and make sure that the loan documents adequately protect our client in the event its customer falls into insolvency.

Our well-established ability to protect our clients’ interests and keep them informed of what to expect in an insolvency proceeding is what drives businesses and commercial lenders from all over Wisconsin to rely on Hanson & Payne when they find themselves in the unfamiliar territory of a state court receivership or a bankruptcy court. If you are in this situation, we are ready to help. Please contact our office today to schedule an initial consultation.

Negotiate Debt Like A Kid Who Doesn’t Want To Go To Bed

The ability to negotiate is a skill that most of us are born with. If you doubt you were ever a skilled negotiator, think back to the sort of deals you were willing to cut in order to stay up past your bedtime or get something else you wanted when you were a kid. If you are anything like the attorneys at our firm, you would have volunteered to do the dishes for the next month if it meant staying up an extra 15 minutes on Sunday evening. 

Unfortunately, as we get older, negotiating becomes a task we dread, especially when we have to negotiate things like debt. Just hearing the word negotiation probably makes you think of a high-pressure car salesman or that vendor you tried to haggle with at the 7 Mile Fair. 

It is time for all of us to take a step back to the days of our youth and embrace negotiation as a valuable skill. At Hanson & Payne, we often use debt negotiation skills to help our clients avoid filing for bankruptcy. 

The First Rule Of Negotiation

The first lesson of negotiation is one that you understood as a kid — identify something you have that the person you want to negotiate will value. When you were a kid, it was various chores. For creditors, the thing they value most is getting paid, the sooner the better. 

Debt negotiation typically involves offering your creditors a lump sum payment now if they will agree to reduce your overall debt load, decrease your interest rate, lower your monthly payments, or some combination of all of these. 

The best candidate for debt negotiation will have a sufficient cash supply to grab the interest of the creditors, who generally want a single lump sum down payment on the negotiated debt, followed by smaller monthly payments until the negotiated debt is paid off.

If you are a plaintiff in a personal injury action (ex. car accident or medical malpractice action), we may be able to structure a debt repayment plan funded by your award in the personal injury action. 

If you would like to refinance your house to raise sufficient funds to pay your creditors at a discount, we can put you in touch with finance companies that do not charge the painful interest rates most finance companies offer to people who have debt issues.

Negotiate Your debt with The Threat Of Bankruptcy 

Don’t have the cash to make a lump sum payment? Think back to your childhood negotiation tactics. What would you do if your parents wouldn’t let you do more chores in exchange for what you wanted? Resort to threats. 

Creditors won’t care if you say you are going to scream or hold your breath until you pass out, but they may be motivated to cut a deal if they know you are considering filing for bankruptcy. Depending on the type of debt you owe them, they know if you file for bankruptcy they may never get paid back, or will only get pennies on the dollar. 

Contact Hanson & Payne Today

If you are struggling to pay off your debts, and are worried that bankruptcy may be your only option, now is the time to contact Hanson & Payne. Our experienced team of attorneys can take a look at your case and lay out all the options available to you to help you negotiate your debt. Contact us today to day to see if you are a good candidate for debt negotiation.

For the Love of Kringles

What do you do when a product you love may be discontinued because its manufacturer is facing bankruptcy? You buy the brand of course! At least that’s what Wisconsin resident Margaret Ebeling did. Thanks to her, you can still get an alcoholic beverage that tastes like our official state pastry, the Kringle. 

According to the Milwaukee Journal Sentinel, Ebeling is the former marketing director of the now-bankrupt Death’s Door Distillery. She knew the company was in financial trouble, but when her boss announced they were discontinuing her favorite product, Kringle Cream, she was heartbroken. She decided to buy the brand in order to keep it on the shelves. 

She is now working with a Milwaukee-based co-packer and a distributor to build her business. Milwaukee is a natural home for this Kringle-favored drink since the Milwaukee-Racine corridor is Wisconsin’s Kringle belt. And in case you were wondering, the product is made with 100% Wisconsin cream. 

We wish her success as she takes a product that could have been lost to bankruptcy, and runs with it. 

A Familiar Story

The story of Kringle Cream is not an unfamiliar one to those of us in the bankruptcy world. At Hanson & Payne, we regularly work with companies who are in financial distress, and willing to do almost anything to stave off bankruptcy. We facilitate the sale of assets and provide advice on how particular sales may impact future legal actions. It is important that sales be structured so that there is no question that they should be invalidated if the sellers ultimately file for bankruptcy. 

At Hanson & Payne, we understand that risk and sacrifice that goes into starting and running a successful business. And there is no one out there who can appreciate how hard it is to accept that an endeavor you have poured your heart, soul, and money into is not going to make it. We help businesses hold things together when times get tough and wind things down when it no longer makes sense to go on. We are business-savvy, but also compassionate guides during difficult times.  

Passing The Torch 

We also work with people and businesses who are interested in buying assets from distressed businesses, or out of bankruptcy court. There are lots of rules and regulations that must be followed in these situations, so working with an experienced attorney is key. We can assist with due diligence, financing, contract negotiation, and other matters. 

Our firm also has a great appreciation for the work that business owners and entrepreneurs do. We know that the risks they take are what keep our economy ticking. It is our honor and privilege to serve them when they have legal needs. 

Milwaukee’s Bankruptcy Firm 

Hanson & Payne, LLC is a trusted advisor to businesses in the Milwaukee area. We have a reputation for being business-minded in an industry that is often criticized for not understanding that legal action is a means to an end, not an end in and of itself. If you are looking for legal counsel, we would be honored to take your call. Contact us today to schedule an initial consultation. 

The Government Wants The Angel’s Share & The Devil’s Cut

A few years ago, Jim Beam came out with a new product called “Devil’s Cut.” 

According to their website, “When bourbon ages, a portion of the liquid evaporates through the barrel and up toward the heavens. Believed to be angels claiming their dues, this has been dubbed the “angel’s share.” Jim Beam Devil’s Cut is not that portion. Instead, it’s made from the liquid that gets trapped deep inside the wood of the barrel—the devil’s share. And through our proprietary process, we’ve found a way to extract it.”

It’s clever marketing for the barrel-extracted liquor moonshiners commonly call “swish.” It’s also the perfect analogy for the way the government likes to tax businesses. 

The Angel’s Share and the Devil’s Cut

When you are setting up a business, the government charges you a fee. The government then takes a portion of every cent you make. It is the first creditor, the first customer, the first person you pay. It takes the angel’s share. 

As United States Supreme Court Justice Oliver Wendell Holmes, Jr. remarked, “Taxes are what we pay for civilized society.” The government believes this, and wants you to believe it too. That doesn’t mean you shouldn’t take advantage of every tax break and loophole your business qualifies for. The laws creating those tax-saving measures were written for a reason, so there is no shame in taking the government up on its offer. 

The government also wants the devil’s cut. If your business is in trouble, or on the brink of bankruptcy, the government squeezes what it can out of you. It assesses fines and fees if you want to close up shop, and charges people who want to file for bankruptcy. If you fall behind on your taxes, both the IRS and the Wisconsin Department of Revenue levy fines, charge fees, and tack on burdensome interest rates.

Why Bankruptcy Attorneys Can Help Businesses Struggling with Tax Debts 

As bankruptcy attorneys, we are often called on to assist businesses that are struggling to pay their tax debts. In some cases, these debts alone are what is pushing the business owner to consider filing for bankruptcy or closing up shop. 

While most tax debt cannot be discharged through bankruptcy, there are steps you can take to minimize your tax liabilities. 

The secret to resolving tax issues to your benefit is timing. When you file a late tax return, how far along the IRS is in its collection process, or when you choose to file a final tax return for a failing business, can make the difference between paying the IRS or the state 100% of their claims against you, or 0%.

Our firm can tell you what you need to do to begin addressing your tax liability without triggering an audit, and explain what your personal tax liability will be if the business fails. We will work with you to develop a strategy that will minimize, and possibly eliminate, your obligation to the taxing authorities. Please contact us today to schedule an initial consultation. 

Check the Expiration Date on Those Debts

A friend of ours was recently helping their parents clean out their house so they can downsize. Tucked away in a forgotten drawer was a pile of coupons clipped in the 1970s. Instead of chucking them in the trash, our friend outsourced the task of sorting through all the coupons to his kids to keep them busy. Some were for products that no longer exist. Most had long expired. But a few were manufacturer’s coupons with no expiration date. You could take one of those down to the Piggly Wiggly and use it today. 

In many ways, old debts are a lot like those old coupons. Most businesses and creditors have old debts sitting in their metaphorical junk drawers collecting dust. At one point in time, the creditor hoped to collect those debts, but eventually, it was not worth the time or money spent to seek repayment. Now, some of the debts are owed by companies and people that no longer exist. Other debts have expired. 

What are expired debts?

Expired debts, like expired coupons, are worthless. You can ask a store to honor a coupon past its expiration date, but it will probably say no. The same goes for expired debts. You can try to collect them, but savvy debtors will know they are no longer legally obligated to pay you. 

Debts expire after the statute of limitations for collecting them has run. After the statute of limitations has run, the debt is no longer collectable. Each state sets its own statute of limitations, and different types of debt may be treated differently. Many Wisconsin debts expire after 6 years. 

Wisconsin Law on Debt Collection – Chapter 427 of the Wisconsin Statutes

The bulk of Wisconsin’s laws on debt collection can be found in Chapter 427 of the Wisconsin Statutes. Even merchants who are attempting to directly collect a debt owed to them must follow Wisconsin’s debt collection laws. This is important to note because many merchants collecting a debt owed directly to them mistakenly believe that they are exempt from Wisconsin’s debt collection laws because they are not included within the definition of “debt collector” under the federal Fair Debt Collections Practices Act. 

Be sure you are in compliance with both state and federal laws when you are attempting to collect a debt owed to you. If you violate Wisconsin’s law relating to Debt Collection Practices, there are several remedies available to the consumer.

The final way old debts are similar to the drawer full of old coupons is that processing them is often outsourced. The kids sorted the coupons, and debt collection agencies are often tasked with collecting debts that are overdue. 

Work with an Attorney to Get Your Expired Debts Settled

If you have a pile of old debts collecting dust, and you are interested in collecting them, make sure you are not wasting your resources going after expired debt. Consider outsourcing your collections to a repudiable collections agency, or working with an attorney that has experience serving businesses and creditors like you. If you are looking for representation, please contact our office today to schedule an initial consultation. 

Beware Bankruptcy Petition Preparers

When you are on the brink of bankruptcy, getting some much-needed advice and assistance can be a life-saver. But be careful who you trust. A Milwaukee area woman recently got busted for giving bad advice to filers in our area. 

Carolyn A. Word, who has also gone by the name Carolyn Dixon, may be criminally prosecuted for ignoring a 2010 order not to work as a bankruptcy petition preparer, and attempting to hide her post-2010 activity from the court. 

Who Are Bankruptcy Petition Preparers?

Bankruptcy petition preparers are non-attorneys who can — as their name suggests — help you prepare a bankruptcy petition. However, they are only typists. They are prohibited by law from giving legal advice. Petition preparers in the Eastern District of Wisconsin, which includes Milwaukee and the surrounding counties, may charge a maximum of $75 for their service. 

Word was previously barred from serving as a petition preparer, and fined because she overcharged low-income people for her services, and may have offered improper legal advice. However, it appears that she did not stop preparing petitions. Word got caught because she told one of her clients to lie to the court, and hide the fact that she had provided assistance. 

While there is nothing wrong with working with a bankruptcy petition preparer if all you need is someone to help you type up your petition, you should be careful about who you work with and be wary of any advice they try to give you. Working with an experienced bankruptcy attorney is a much better option. 

An attorney can do much more than help you fill out the piles of paperwork a bankruptcy requires. 

The first thing an attorney will do is help you figure out if bankruptcy is truly the best option for you, or if other actions could be taken to help get you back on track. 

If bankruptcy is the best path forward, the next step is figuring out which type of bankruptcy is right for you. Most people file under Chapter 7 or Chapter 13. A Chapter 7 bankruptcy is a traditional liquidation — your assets are sold off, the proceeds are used to pay off your debts, and most remaining debts are forgiven. A Chapter 13 bankruptcy is more like a corporate reorganization — you enter into a court-supervised repayment plan, and after a few years you are caught up on your payments and some debts are forgiven. An experienced attorney can help you determine which chapter it would be best for you to file under. 

The Benefits of Working with a Bankruptcy Attorney

Once you have filed your bankruptcy petition with the court, your attorney will work as your advocate and liaison with the court. You will never have to show up to court alone or answer questions without someone who is on your side explaining them to you. 

Perhaps more importantly, your attorney becomes a shield between you and your creditors. Once you obtain legal representation, you can tell your creditors they must speak to your lawyer instead of contacting you directly. 

The benefits of working with an experienced bankruptcy attorney are many. While others may offer you help with your bankruptcy case, what they can do for you is extremely limited. You should be suspicious of any non-attorney that says they can help you file for bankruptcy.