Friday, April 16, 2010

Finance Friday: Lawyers

**Disclaimer: I am not certified to give legal or financial advice. This is simply an explanation of my process. The ideas contained here are my own opinions.**




I had a reader post a comment, in reference to my bankruptcy post, asking about how to find a good lawyer. This actually isn't the first time I've had to go though the process for finding a lawyer. The first time was with some legal issues that my husband had. But, we still went through the screening process to find one we wanted to work with. I tried responding with a short comment, but after about 4 paragrahs, I decided to just make a post about my process. Then I could add in other details!

I feel very fortunate to have immdiately found a lawyer that I felt comfortable with for my bankruptcy. Not only am I admitting to this person that my financial skills have failed, I'm revealing all sorts of personal data to them. By the time you're done, they have a copy of your driver's license, Social Security Card, pay stubs and bank statement for the previous 6 months, a copy of your credit report, and just about everything except your first born child!



My process was pretty simple. I opened up to Bankruptcy Lawyers in the yellow pages, wrote down a few names, and started Yahooing (like Googling, but only with Yahoo) them to find out any other information. Some bigger law firms have websites which allow you to do everything online. Secretly I was hoping to find one of those. I don't think I was ready to admit out loud that I was a failure. I didn't find exactly that, but I found a small website and an email address for a local lawyer, so I decided to do the rational thing and email him. A day or so later, he emailed me back and told me he wasn't taking bankruptcy cases anymore. He then referred me to a friend that was doing bankruptcies.

I had to summon all the courage I could in order to pick up the phone and call this guy. I'm not sure why, but talking to strangers on the phone gives me mini panic attacks. My hands start shaking, my voice cracks, you get the idea. Just picture a 13-year-old boy trying to talk to the cute girl he likes at school. That should about sum it up! Maybe it's because I've been trying to avoid creditors for years now? A sort of Pavlov's Dogs type thing? I've talked to so many creditors (strangers) over the years that calling strangers makes me freak out?

I finally did call the guy (without a dial-and-hang-up fiasco) and was able to just leave a message. Phew! Bullet dodged. Anyway, he eventually called me back and we set up a consultation appointment.

The first thing I noticed, and liked, was that he was very good-natured and made a very awkward and uncomfortable situation into an easy going but still serious meeting. We even laughed! So when you're screening lawyers, make sure to ask if they offer a free consultation. Most worthwhile lawyers will. In my opinion, if they don't, then move on to the next guy. With bankruptcies, the initial consultation is to see where you're at to see if filing bankruptcy is really necessary. At my consultation, my lawyer told me of a guy who was living on Social Security and wanted to file bankruptcy because he couldn't afford to pay his debts anymore. He told the guy that he shouldn't file bankruptcy because he was judgement proof - Social Security wages can't be garnished and the creditors wouldn't be able to do or take anything. He should save his money for something else. To me, that was pretty cool that he would tell the guy not to do it, even though he could have taken the guy through the process just for his own profit.

Unfortunately, for most people, it comes down to price. How much does the lawyer charge? How much am I going to have to fork over to some yahoo who may or may not do what I want him to do? Very few people, whether facing criminal issues, divorce, bankruptcy, or anything else, have the ability to shell out $1500 - $4000 as a retainer fee. And, as with any product out there, higher price doesn't always mean higher quality. You need to know, upfront, how much they're charging you. And, after they've used up the retainer, what are their fees? I'm not sure if you know this or not (I didn't when we started the legal process with my husband) that the retainer is not expected to cover all of their services? That's their upfront fee and then you have to pay them for everything else after that. After the $2000 retainer fee we paid for my husband's lawyer was used, we still owed almost another $2000!!! They charged for every minute of every phone call and even the simple intake of any paperwork we sent them. Those are things that I/we didn't know about.


You're also more likely to find better rates if you go with a single, more unestablished lawyer rather than a law firm. For instance, the lawyer I have right now doesn't have to worry about costs for renting or owning a building. Instead, he borrows the conference room of a local law firm. Those savings get passed on to me, in the form of lower retainer fees, filing fees, etc.

During your consultation and at anytime with the lawyer that you choose, DO NOT BE AFRAID TO ASK QUESTIONS!!! They've spent years going to law school and you're paying them a small fortune. You have every right to ask questions - no matter how silly you think they think you are. You need to be informed about every aspect of your case. Make sure to get copies of all documents and forms.


Talk to others about reccommendations - good and bad! Finding out the bad is just as important as the good. Like I said before, this is someone you're trusting with very personal and confidential information. You need to feel comfortable with them. And you don't want to get stuck with someone who's going to screw you over.

A couple of side notes directly related to bankruptcy cases. You can handle the bankruptcy yourself or work with a "pro-se," or someone who is qualified to help you through the process. You still do the work and the filing yourself, but you get a little help along the way. However, the bankruptcy process is very technical and must be done in a very exact way. You can read more about filing for bankruptcy without a lawyer at USCourts.gov.

Also, beware of scams claiming that they can erase your debt, even when they claim they can do it "legally." Beware of companies who claim that they will negotiate with your creditors for you. There are a lot of companies out there that will claim they're working with your creditors, that you should pay them, and then they'll distribute your money. Chances are, they're just going to be taking your money on a monthly basis and you'll continue getting calls from creditors.

Do you have any additional tips for finding a good lawyer (for any type of legal case)?

3 comments:

  1. Nice site, very informative. I like to read this.,it is very helpful in my part for my criminal law studies.

    ReplyDelete
  2. I'm glad you ladies found this helpful!

    ReplyDelete

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