Can Debtors Afford Bankruptcy? Finding Low-Cost Bankruptcy

It seems palpable in the air, an ominous additional burden for the average American borrowers and highly indebted consumers in today's dire national economic conditions, see perhaps his only chance for some relief to find in files bankruptcy: finding low-cost bankruptcy low - cost of bankruptcy that you can afford. Meaning, essentially a non-lawyer pro se alternative.

The latest figures just released by the Secretariat of the United States> Bankruptcy Courts in the February 2009 bankruptcy filings, made a living reality crystal clear to nearly every one, namely that the rate at which the increasingly overwhelmed and) American troubled borrowers (individuals and businesses are responsible for the bankruptcy filing, has been at its highest level the now famous (or notorious, many would say!) drastic changes of 2005 to the U.S. bankruptcy law. But even more clearly that the new registration is threateningBeginning to return to the old "hate" high levels of bankruptcy filing that was the nation that achieved before this new law, passed in 2005, ostensibly to reverse the correct and curtail drastically or the high registration numbers then existing levels.

This trend in the American debtor bankruptcy filings strongly emphasizes a few basic points, among others. First, the depth and seriousness of the straight and financial difficulties in which the average American consumer andDebtor is in today. Secondly, the reality is that no matter how difficult legal hurdle and obstacle to the institutional powers that could (the Congress, the lawyers or financial institutions, courts, etc.) attempt to try to place on the path of American debtors, discouraging free or that it ever more difficult for them to find relief from the bankruptcy of its debt if it is really time to the difficult financial and economic crunch, Americans will still find a way somehow, and isstill persevere and continue to be against all odds in demanding their constitutional rights to be heard in bankruptcy, and thirdly, the critical need for the average debtor in the search for affordable alternatives to filing bankruptcy lawyer.

Elizabeth Warren, a Harvard Law School professor and author of several books on bankruptcy, probably best sums up the point that, in allusion to the persuasive power of Congress by various special interests, the law of 2005, theyrestricted that the debtor from filing for bankruptcy: "The banking industry [and other interest groups] did his best to drive the cost of filing [bankruptcy]. But if families in trouble enough, they will struggle their way through the paper ticket and higher costs for lawyers "to get help", added: "The word is now leaking out [again], that the bankruptcy courts are open for business."

THE "unofficially bankrupts - debtors who do NOTFILE, because they can not afford it

But above all, as the, now from the perspective of the average bankruptcy petition, this raises a fundamental question, however. Indeed, as the current growing army of American increasingly desperate borrowers who will not only seek to for personal or business bankruptcy, but in many cases really need to file a file to log OPENS bankruptcy - particularly the high legal lawyers' costs registrationBankruptcy? How do these claims which have, or find low-cost bankruptcy? A bankruptcy, the debtor can afford adequate?

Approximately 1.1 million (1,064,000) American borrowers to open insolvency proceedings in the past year 2008 - submissions, which were many analysts are quick to remind us, in spite of these debtors, and conducted under harsh conditions, a whole series of strict, restrictive requirements and dramatically increase legal fees enacted in 2005. But,even more significant, from the standpoint of the debtor or the bankruptcy-seekers, is another closely related FACT: the worse, according to experts, THERE'S AMERICAN nearly as many debtors who wanted to file for bankruptcy and are eligible, but could not, because she could not afford it, the laws of the attorney's fees. These are borrowers who Justin Harelik, a bankruptcy attorney with Price Law in Los Angeles, call the "unofficial bankrupts - debtors who areto make all but bankrupt, but a lack of strong lawyers' price, their status official!

Annual number of bankruptcies SINCE 1998
Source: creditslips.org

Insolvency years ....... ....... Filings ......... Source & Notes
1998 ....... .......... 1.442543 AO data ......( Office of U.S. Courts)
1999 ....... ......... 1319465 AO data
2000 ....... ......... 1,253.444 AO data
2001 ....... ......... 1,492-129 AO data
2002 ....... 1577, AO 561 ........Data
2003 ....... ......... 1589383 AO data
2004 ....... ......... 1597462 AO data
2005 ....... 2078415 ......... ........ AO data includes number of entries before 2005 BKR. Legal
2006 ....... 590,544 ........... AACER data ... (automatic access to Court Records)
2007 ....... 826,665 ........... AA.CER Data
2008 ....... 1064000 ......... AACER Data

Even the lawyers AGREE WITH FEES her big a problem with DEBTORS

In fact, although many bankruptcy lawyers would be that they tendare shaded, many other lawyers who recognize objectively that the statutory attorneys' fees for bankruptcy most common question and concern for the debtors and customers in bankruptcy practice.

"They have to pay 7 Chapter lawyers in advance in cash. You can go too poor to be bankrupt," said Dr. Robert M. Lawless provided by the University of Illinois College of Law, once.

Another observer, Jenny C. McCune, an editor at Bankrate.com, notes that, rather surprisingly, we have now come to the point where a debtor "funding may have filed bankruptcy," adding: "It may sound like a Catch-22 ... you have no money, so you for the application are bankrupt, but you have [legal fee] money, so you can file bankruptcy. "

Janathan Ginsburg, bankruptcy attorney, Atlanta, Ga., said that in telephone conversations that he frequently with callers, where severe financial crises that are thoughtfully possible> Bankruptcy, after their first question is often general in nature, "The next question I will do must of fees:" If I have no money, how should I pay for a lawyer? "

Bankruptcy lawyers, schooled in the art of argumentation and defense of the clearly not acceptable, especially if it focuses on the protection of a lucrative way to a lively, often fall into what are essentially before, really deep philosophical arguments to justifythe high fees that they are free - it is really still a "bargain" for borrowers, given the much larger sums of money they are in bankruptcy discharge if a debtor is "really" pushed hard enough by its debt burden and is difficult to liberate "themselves to from him, he will somehow find a way to a debtor, if he really "serious" is always the lawyer's fees from somewhere, we say, make the retention of the payments he would have been to other creditors and then using it to to pay lawyers to free him fromthe larger burden of debt, etc., etc. It is a complex web of arguments that would have to wait for another day to address. But for our immediate purposes of this current article, the relevant question is crystal clear. The point clearly is that for the average American today debtor already reeling from high debt burden, and the main object he is (from the attempt, through bankruptcy notification address is the average fee for bankruptcy lawyer about $ 2,000 or more forsimple Chapter 7 bankruptcy, and $ 4500 + for his counterparts in Chapter 13) is high, in fact, even exaggerated, and often it is simply beyond their means - in short, simply unaffordable.

Attorneys HAVE "PRICED OUT" A LOT of debtors

It appears that the bankruptcy lawyers are fueled by greed and monopolistic instincts gradually volumes from the personal bankruptcy filing companies that the only realistic alternative is trying to left, seems toa non-lawyer low-cost bankruptcy.

"Surveys have shown that many of their attorneys fees have doubled to cope with new requirements imposed on the BAPCPA of 2005,. Many thousands of debtors were represented by a lawyer, therefore, prices in its bankruptcy," says Stephen Elias, a California lawyer and bankruptcy specialist and author of several books on the subject. "Because of the rules governing the practice of law, the only legal alternative to... Is self-represented lawyer bankruptcy petition preparers to help with your paperwork. "

The point is then clear. The basic task at hand at this moment in the field of insolvency, is to develop a credible system is that low costs for the filing of the bankruptcy, is the simple, straighforwards and easily accessible, and above all affordable to the debtor, the legitimately seek or need to bankruptcy and are qualified andEntitled to file under the conditions of participation. It is, after all, that imposed no "gift" or a kind of "favor" by "the law", or some sort of charity-gooders peddling the legal establishment. But a direct gift of the Holy Law and the U.S. Constitution.

It is a task which we shall all be especially the constituency of bankruptcy and the bankruptcy of the industry leaders, who control the present bankruptcy system - the financial and banking industry,The courts, the Congress, but also private entrepreneurs and individuals who may come with new ideas or fresh ideas about how the current system to repair broken personal bankruptcy, and yes, the current bankruptcy lawyers and bar, and others.

But his interpretation of more immediacy and urgency, but in the meantime, while we expect such a new system by the responsible parties are qualified American entrepreneurs, institutions and organizations in a position to be free to comewith practical and effective ways and methods - alternatives to the current very poor and inadequately controlled, legal and bankruptcy system - which actually legitimate bankruptcy seekers to find their legitimate constitutional right to exercise the bankruptcy relief option, if and when required - just accessible and affordable. Must in sum, America, in both public and private sectors to prepare quick, develop and implement a drasticdifferent but effective bankruptcy filing system that the current million plus per year and the extra millions coming from bankruptcy filers who will be, as provided for in the bankruptcy filing pipeline per year, sign a really affordable means for them bankrupt - the 1 , 4 million U.S. filers (or more look) that is expected to discharge in bankruptcy in 2009 calendar year alone, and beyond.