The Benefits of Seeking Legal Assistance When Filing Bankruptcy
Hiring an attorney during bankruptcy may help a person avoid technical mistakes, inappropriate actions by creditors and ill-advised legal decisions.Finances are an unavoidable concern for people who intend to file bankruptcy in Austin. As a result, many of these individuals may consider handling the process alone to reduce the associated expenses. This decision often carries its own costs, however. Anyone who is thinking of filing bankruptcy should also consider seeking the assistance of an attorney in light of the following benefits of completing the filing process with legal representation.
1. Identifying an Optimal ApproachAn attorney can help a person assess whether bankruptcy is even a suitable option or whether alternatives to bankruptcy, such as debt negotiation, may be more favorable. If bankruptcy is an advisable choice, an attorney may be able to help a person determine the most advantageous approach, given the person's income, assets and long-term financial goals. The U.S. Courts website notes that an attorney can offer advice on all of the following issues:
- Which chapter of the U.S. Bankruptcy Code to file under
- Which debts may qualify for discharge at the end of the bankruptcy filing
- Which property may be exempt from repossession or liquidation
An attorney also may be able to help a person assess frequently overlooked consequences of filing bankruptcy, such as the associated tax implications. People who file bankruptcy without legal advice, in contrast, may be at risk for misunderstandings and less favorable outcomes.
2. Stopping Debt Collection Actions
An attorney may also be able to help a person protect his or her rights against creditors or debt collectors during the bankruptcy filing process. Under the Texas Debt Collection Act, debt collector harassment, abuse and fraud are not permitted, regardless of whether a person has filed bankruptcy. Additionally, filing Chapter 7 or Chapter 13 bankruptcy creates an automatic stay, which halts many collection activities, including foreclosure, eviction and wage garnishment.Unfortunately, it isn't unheard of for creditors or collection agencies to violate these laws, and consumers who aren't familiar with their rights may face illegal or unfair practices. An attorney may be able to advise a person of his or her rights and protect those rights throughout the debt resolution process.
3. Avoiding Unnecessary ErrorsThe bankruptcy filing process is highly technical, and errors can lead to the dismissal of a person's case. Furthermore, professionals such as clerks are prohibited from assisting or advising consumers as they complete a bankruptcy filing, according to the U.S. Bankruptcy Court for the Western District of Texas. An attorney may be able to help a person ensure that a bankruptcy filing is not delayed or dismissed due to errors in paperwork, missed deadlines or similar preventable issues.
Seeking Further Advice
Before committing to handling the bankruptcy process alone, consumers should at least consider speaking with an attorney to determine whether this is an advisable option. An attorney may be able to help a person understand any unusual issues that may arise during his or her case and assess the potential benefits of partnering with a legal representative.