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Judgmental Bankruptcy Attorneys? Nonjudgmental and Sympathetic Bankruptcy Lawyers in Arizona?

It always surprises me when clients tell me that they were afraid to come in and talk to a bankruptcy attorney in Arizona, especially one who is board-certified as a bankruptcy specialist.

I’m used to one kind of fear; a lot of folks know that their finances are out of control, because they can’t pay their bills! Or because they’re being sued. Or there’s a trustee’s sale pending on their house. And even though they know they’re in trouble, they don’t want to look at the wound.

Kinda like, if I don’t make any noise, or even look at it, the monster will go away!

Of course, that doesn’t happen, and that approach leads to bad outcomes.

But there is a different kind of fear of bankruptcy lawyers in AZ that surprised me.

Potential bankruptcy debtors are afraid that the bankruptcy lawyer will judge them harshly for running up so much debt on their credit cards, or consider them stupid for investing in real estate, or getting a quarter of a million in student loans with a degree that guaranteed they wouldn’t get a job even in good times!

Now, that’s like worrying that the cancer specialist is going to judge you harshly because you have a big lump. Or the medical doctor will judge you harshly because you have an ugly wart. Or an especially complex forearm fracture.

I’ve been doing this a long time now, about thirty years. And I’ve been Chairman of Everything Bankruptcy, more or less. And therefore I know a lot of bankruptcy lawyers.  I know smart bankruptcy lawyers; I know board-certified bankruptcy lawyers. I know business and consumer bankruptcy specialists, and guys who do mostly Chapter 7s and mostly Chapter 13s and mostly Chapter 11s. I know bankruptcy lawyers who go to church, and bankruptcy lawyers who drink a lot and chase girls (or boys). I know smart bankruptcy lawyers and dumb bankruptcy lawyers.

But, except for bankruptcy creditor lawyers, I don’t know a single judgmental bankruptcy lawyer.

Because that would sort of defeat the purpose, right?

Although, frankly, I’m not sure I’d be comfortable going to see a bankruptcy lawyer who handled both debtor cases and creditor cases.

But that’s just me. Maybe that would give ‘em more perspective, you know?

But people file bankruptcy for all kinds of reasons.

I mean, really.

Some lost a job. Some lost a spouse to death. Some enjoyed a seven-year long divorce. Some had an entire industry disappear on them ( a contractor recently said to me, it’s as though you were a dentist, and you woke up one morning and nobody in the country had any teeth!).

And there are unusual reasons that people file; a crazy judgment for a trillion dollars is entered against them (nobody wants their day in court after they have their first day in court, by the way). Or the debtor is bipolar (I’m seeing a bit more of that lately) and charged two million dollars during a manic phase.

Or the debtor is in a depressive phase and doesn’t respond to a complaint that had a perfectly good defense, and now is stuck with final judgment that can’t be appealed (you can try to set aside the judgment, but you’d better go swim in Lourdes first; and drink a few gallons of the water, as well. And it might be good if you also eat the entire Blarney Stone).

Or the potential debtor might have a gambling addiction, and they might have dumped their life savings in Vegas, and those life savings will stay in Vegas, you know?

Now, I don’t particularly care how a debtor got that way, any more than a board-certified oncologist cares about how the tumor got that big. Or a board-certified cardiovascular surgeon cares about how you got that much plaque in your arteries. 

The concern is always how to fix the problem, and how to get the best practicable outcome for the client. 

The best possible outcome is often out of reach, because the client has waited too long to come visit a bankruptcy specialist, and steps have to be taken sooner than the bankruptcy attorney would like. 

Or worse, the client has taken steps which will of necessity delay filing,  like pulling too much money out of a 401(k) (which will count as income under the means test, and may require waiting to file until that month of “income” falls off the rolling six-month lookback period), or a preference payment to mom, which could delay filing by a year if the amount is substantial. 

These days, post-2005 Amendments to the Bankruptcy Code, it is not unusual for a client to hire a bankruptcy lawyer and have to wait seven months to file a Chapter 7. 

On the other hand, that’s a lot less pain, overall, than the poor client would have to suffer in a five-year Chapter 13.

Sometimes you gotta be cruel to be kind. 

Or something. 

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