This may not sound like a big deal to some of you with deep-rooted negative feelings about bankruptcy, but it illustrates an important point. When a bankruptcy is filed lives can change dramatically for both creditors and debtors. Families, friends and employers receive the direct benefit of the debtor’s fresh start – a happier person.
The basic principal behind bankruptcy is a fresh start for debtors (and their families).
Starting a new life of financial freedom.
The basic principal behind bankruptcy is to permit debtors an opportunity for a fresh start and the creditors are to receive equal distribution of available assets. What a magical theory! Before filing bankruptcy someone’s life is barely held together – they are terrified of answering their own phone; they are embarrassed at work by calls from collection companies and they may be in fear of losing their home or vehicles.
After a bankruptcy is filed many of my clients tell me that they can breath easier and sleep through the night. Their wage garnishment stop so they can pay the rent and buy food. They go to work with their heads held high; they can answer their phones and open their mail without feeling sick.
– Diane L. Drain
Bankruptcy laws are very powerful and they are all encompassing. Most other laws must bow to the bankruptcy laws.
A divorce, a lawsuit and a foreclosure of property are all put on hold until, and only if, the bankruptcy is no longer in force, or the Bankruptcy Court gives those creditors permission to continue with their actions.
Unlike most areas of law, bankruptcy dictates that the lawyer be well versed in many areas of law, be a very good negotiator and sensitive to the differing needs of all those involved. It is the only area of law that does not normally pit one party against the other. Unlike most courts there is rarely a battle of copy machines, nor does the number of associates assigned to the case directly affect the outcome. In fact, rather than the outcome turning on the lawyer’s ability to write long, complicated legal briefs, it is measured by their knowledge of the law, understanding of the policies and procedures and their ability to find creative solutions.
A good bankruptcy lawyer must be tuned into the actual cost of continuing litigation versus the benefit to the parties (both creditor and debtor). Therefore, the more the bankruptcy lawyer knows about the practical issues facing the parties, the more practical the conclusion for all and the lower the financial losses (attorney fees).
– Diane L. Drain
The banking industry would argue that borrowers chose to accept and use credit cards or take out loans.
Borrowers also sometimes chose to obtain money from a loan shark yet the lender is prohibited by law from breaking any bones for late or non-payment. There also is free choice involved when an innocent person discloses personal information to an unscrupulous telemarketer, yet the consumer fraud division of the state attorney general’s office will still protect the individual. Banks, due in large part to their greed, sometimes make flimsy investments, yet they receive, at taxpayer expense, a bail out. Credit card users need a bail out – thus bankruptcy laws are developed.*
Perhaps now you begin to see why I say that bankruptcy law is very fascinating.