Even if two bankruptcy cases are identical, the clients may have totally different experiences.
How Can Similar Cases Differ?
Bankruptcy is about perception more than anything else. What is easy for some people may be hard to do for others.
I saw two clients recently. Both had essentially identical circumstances: modest homes with mortgages, modest cars, and modest income. They both owed over $30,000 in unsecured debt which generally includes charge cards, medical bills, and some personal loans. Neither of the clients had even a little chance of being able to pay the money back.
For client number one, her daughter and two grandchildren moved in a while ago and had no income whatsoever. The daughter and children have needs that require additional expenses, including substantial driving costs which run up not only the gasoline bills but the car maintenance on the modest car.
Client number two has extensive medical issues that have substantially reduced her income to half of what it was. She wasn’t prepared for such a large decrease, and her bills have piled up.
Accepting The Game Plan
When I told client number one that she should file for bankruptcy, she agreed. Since she needed money for her utilities, car payment, insurances, food, and other items, I told her that meant she had to stop paying the unsecured debt. She agreed wholeheartedly.
I told client number two the same, stop paying the unsecured debt. She balked. “How can I stop making these payments? They will come after me,” she said. “I am so uncomfortable not paying them.” I told her that her utility bills were behind, her vehicle needed to be repaired, and that the bankruptcy itself will cost a modest amount. She then asked how she would afford all of these things. I told her she can start by halting the payments on the unsecured debt, but she countered that it was hard for her to do this. Eventually, I convinced her by detailing the numbers on her expenses.
It is hard. We pay the bills that we made, except when we can’t. During a free consultation at Steidl and Steinberg, we carefully examine the expenses you have and compare it to your income. If, in our experienced judgment, we determine that you cannot pay these bills, we will tell you and offer ways to help. We will also tell you if we believe you can pay all or part of these bills, and help you tackle debt without bankruptcy.
I know it is tough to stop paying the bills. You might have a good credit rating. You are used to making these payments. But isn’t it more important for you to consult with experienced bankruptcy attorneys who might be able to give you a recommendation based on his or her experience with these situations? We would rather your house be heated than you make a payment on a credit card. We would rather you pay your car insurance rather than making a payment on a medical bill. And we would rather you eat a reasonable meal rather than paying on that unsecured personal loan.