Bankruptcy Attorneys: Out of Business
Through the newly minted Wall Street Journal Law Blog, a report on the crisis facing many attorneys whose primary field of practice was personal bankruptcies. After the change in the bankruptcy law last fall, many potential filers are staying away, the attorneys are faced with a morass of new regulations to digest and incorporate, and to top it off, the new law holds attorneys personally responsible for mistakes.
My $.02: If congress intended to reduce the number of personal bankruptcies by making it harder for debtors to find an attorney, they succeeded.
(Note, when I use the term “attorney,” I really mean “debt relief agency.”)
The Law Blog also notes today a study from IU indicating that the third year of law school (or “debt relief agency school”) is pretty much a blow off: Link .
January 4th, 2006 10:32
Anectdotal evidence from my Dad, a “debt relief agency” practitioner in Coloroado confirms the lull in bankruptcy business. But, I wouldn’t necessarily write off the field just yet. I suspect a fair amount of the lull has to do with the crush of business that came before the new rules went into effect. Pretty much all of the potential filers went ahead and got it done. It will take a little while for demand to build up again.
January 4th, 2006 11:17
I think that is a big part of the lull, but “bankruptcy creating events” (layoffs, divorces, medical emergencies) continue, so there are lots of folks out there who find themselves in a position where they would be in talking to me about filing last year.
The perception of folks has been altered, and the changes have become “word on the street.” When I talk to people about divorce now, most come in with an understanding that they will not fit into a bankruptcy, whether that be true or not.
I think that people are walking around with a new respect for unsecured creditors and their debts.
Meanwhile, I am spending lots of time reading the regs, and the commentary on the regs.
January 5th, 2006 14:49
Whereas I am preparing to spend a lot of time kicking around poor people for a few years longer without getting much more money out of them because they can’t (or think they can’t) file bankruptcy.
January 8th, 2006 20:50
kemplog: Bankruptcy Attorneys: Out of Business
The kemplog blog recently published a piece titled, Bankruptcy Attorneys: Out of Business, that discussed how much more difficult it is for attorneys since congress changed bankruptcy laws.