Ronald Ceniceros: Bankruptcy Lawyer Orem Utah

Many families in Utah are burdened with debt. They are unable to pay their debts. Without mounting debt comes increased stress. The inability to pay debts can be a scary prospect. But many Americans are actually living that fear. All is not lost for them. Even if they are unable to pay off their debts, they may be able to get rid of the debts once and for all. This is done through a legal process called Bankruptcy. The government enacted the bankruptcy law to help debtors who are unable to pay off their debts get a fresh start in life. If you like many others in Utah are burdened with debt and unable to repay them, consult an experienced Orem Utah bankruptcy lawyer.

The escalation in debt has turned the smart financial decisions of the prior generation, such as purchasing a home or taking on student loans, into high-stakes economic gambles for middle-class families. Today, millions of Americans are losing those bets, struggling to avoid financial collapse. While bankruptcy is only one measure of serious financial distress, it is the most visible sign of financial catastrophe. It is a public place for seeing financial pain that is largely endured in private, behind closed doors. And because it represents a particularly extreme form of financial distress, it is a useful barometer of the financial suffering of American families. The causes of bankruptcy are complex. For most families, a confluence of factors rather than a single decision or event explains their overwhelming debts. Bankruptcy is a profound financial event that has the potential to rewrite a family’s balance sheet, eliminating some debts and forcing the surrender of some assets. Speak to an experienced Orem Utah bankruptcy lawyer to know how bankruptcy can help you get out of debt.

Bankruptcy For Self Employed Businesspeople

The stories of the business startups that do not make it, leaving their owners awash in debt, are not told. The typical startup occurs in ordinary, everyday industries and often begins because the owner is unemployed. Their story is an example of the hundreds of thousands of Americans each year who find themselves having to file for bankruptcy.

Surprisingly, there is no regular data collection on self-employment rates in the United States. Historically, the Census Bureau’s Current Population Survey would not count the owner of an incorporated business as self-employed, reasoning that the owner was an employee of the corporation. This sort of legal formality does not capture the economic reality of small businesses in which the owner’s financial destiny is tightly tied to the business. Another possible data source, the Small Business Administration (SBA), has historically tracked business firms, not business owners. Even then, the SBA data distinguished between firms with employees and firms without employees, reporting data separately for both types of firms but not providing a blended estimate. Although the presence of employees might have policy implications for the SBA’s work, the existence of employees does not change the owner’s characterization as self-employed.

Even compared with other bankruptcy filers, the self-employed are in a deeper financial hole. They owe more, have pledged a greater percentage of their assets as collateral, and have higher debt-to-income ratios. In the very deepest financial hole are those self-employed who say that their self-employment was a reason for their bankruptcy. These are people who strived for the independence and financial success that is supposed to come from owning a business and consequently took big financial risks to establish their businesses. Instead of living the American Dream, these self-employed people have found themselves declaring bankruptcy.
For most every self-employed person who files for bankruptcy, it makes no sense to talk of a business with a separate existence apart from its owner. Ideas in corporate and partnership law about insulating owners from liability for their businesses have little practical meaning in bankruptcy, where the owner’s financial life is the business’s financial life and vice versa. Only a small percent of the self-employed in bankruptcy said that they operated their business as a corporation, limited partnership, limited liability company, or similar entity that would protect them from personal liability for the business’s debts. Neglecting to incorporate is not necessarily a poor decision for a small-business owner who has to guarantee the business’s debts or who has to use his or her own credit card to borrow for the business’s needs. Many so-called business cards require the owner’s personal liability. Moreover, many small-business loans require the owner to guarantee the business’s debts. For most small-business owners, incorporation brings added hassle and expense but very little in the way of financial protection.

Having financial responsibility for the business’s debts is part of being a small-business owner, at least for the self-employed who filed for bankruptcy. Nearly all of self-employed bankruptcy cases reported some use of personal financial resources to support the business, such as (1) using personal earnings or savings, (2) borrowing from a friend or relative, (3) borrowing from a bank, (4) using a credit card for which they had financial responsibility, (5) guaranteeing a business’s debts, (6) using a home equity line of credit, or (7) otherwise pledging a house or other personal assets as collateral for a loan intended for the business. Even among those who organized their businesses as a limited liability entity, a majority reported having undertaken one or more of the above-listed actions that placed at least some of their personal financial resources at risk for the business. When the self-employed enter bankruptcy, they come doubly laden with obligations, unable to pay both their personal debts and their business’s debts. If you are a self employed person and you want to file for bankruptcy, an experienced Orem Utah bankruptcy lawyer can help you.

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Like any other individual, a self-employed person might file for bankruptcy for a variety of reasons, including ones that are more typically related to consumer bankruptcies such as medical debt or difficulty in supporting a family after divorce or family breakup. These self-employed debtors, therefore, may have bankruptcies that are closer in character to consumer bankruptcies filed by those with regular employment than to those filed by self-employed people. When the self-employed collapse into bankruptcy, they arrive in a deeper financial hole than the rest of consumer bankruptcy filers.

The self-employed in bankruptcy often are subject to the 2005 amendments to the bankruptcy law that were aimed at allegedly overspending consumer bankruptcy debtors. But, a consumer credit counseling program designed to help debtors get consumption spending under control makes little sense for a person who took a risk on a business that did not pay off. Paperwork requirements such as pay stubs are largely irrelevant in the context of a failed business owner who likely does not receive a salary. For the hundreds of thousands of self-employed debtors each year, these requirements are just additional hurdles that add to the expense of filing for bankruptcy and only delay the bankruptcy relief that they need. Some of the paperwork requirements already do not apply to debtors who identify as business filers, but the judicial characterization of most any personal obligation as consumer debt leads many filers to declare themselves as consumer filers even if they are not. It is important that the bankruptcy law should recognize business failures for what they are and not recharacterize such events as bankruptcies caused by typical consumer debts.

More than a million families declare bankruptcy each year, making it one of the most commonly used legal processes in the United States. At the same time, debtors who seek bankruptcy relief are, by definition, financially constrained and thus struggle to afford the costs associated with the process. The challenge of operating a high-volume legal system used primarily by people who have difficulty paying for lawyers pervades most areas of law that serve individuals, but the bankruptcy system has always faced an additional problem of its own: complexity. From its inception with the U.S. Bankruptcy Code of 1978, the consumer bankruptcy system had elements that were borrowed from business bankruptcy, rather than being specifically designed for individuals. Reforms to bankruptcy law, none of which were simplification efforts, have been layered on top of this initial complexity. The bankruptcy system reached a new peak in complexity with the 2005 amendments, which added more than a dozen ways for debtors to run afoul of technical requirements and thereby have their cases dismissed.
People in bankruptcy tend to have very few assets besides their homes. Selling the home to pay for a bankruptcy lawyer would be unthinkable for the majority of homeowner-debtors who enter bankruptcy primarily to save their homes, and in the recession of the late 2000s, selling the home often was not a viable alternative anyway.

This increased complexity has put particular pressure on one crucial decision that all consumer bankruptcy filers must make: whether to hire a Utah bankruptcy lawyer. The answer is yes. Hire an experienced Orem Utah bankruptcy lawyer. Bankruptcy law is complex and you will need a lawyer to help you with your bankruptcy process. do-it-yourself bankruptcy is risky. Errors can cause families to lose their homes or cars, to be denied a discharge of debt, or even to face criminal or civil investigations.
The complexity of the bankruptcy system undermines debtors’ ability to choose successfully between incurring the expense of a lawyer and risking filing for bankruptcy on their own. Pro se debtors have significantly worse case outcomes, and highly educated debtors are no exception. Because all consumer bankruptcy debtors are, by definition, struggling financially, cost almost always constrains the legal services provided. Consumer bankruptcy attorneys have adapted to this reality by providing basic bankruptcy services for a flat fee. A large portion of consumer debtors delay bankruptcy for several months in order to save money for the attorney’s fees. This delay can significantly increase debtors’ financial distress. In addition, many debtors who initially contact attorneys may never successfully save for the fee and end up filing pro se or foregoing bankruptcy relief altogether. Don’t do this. Contact an experienced Orem Utah bankruptcy lawyer. The lawyer will sit with you and work out a solution.

Why You Need A Bankruptcy Lawyer

Be careful of law firms that offer “unbundled” legal services. Unbundling refers to encouraging attorneys to offer discrete services rather than always handling the representation of an entire case. This enables lawyers to charge less and provide some services to clients who otherwise might not be able to afford any representation. When you hire an experienced Orem Utah bankruptcy lawyer, you will be dealing directly with the lawyer. You will spend a significant amount of time with the lawyer to gather documents and prepare the petitions. Your experienced Orem Utah bankruptcy lawyer will supervise the petition-preparation process and handle tasks such as court appearances.

Bankruptcy has become a defining event for millions of families, taking a place alongside college graduation and divorce as a turning point in modern American life. Each month, more than one hundred thousand middleclass families—people who went to college, got respectable jobs, and bought homes—file for bankruptcy. They publicly declare themselves flat broke, losers in the great economic game of life. By the time they file for bankruptcy, unemployment has often decimated their incomes, and their debts are inflated beyond all hope of repayment. At this stage in their life, an experienced Orem Utah bankruptcy lawyer is their best friend who can guide them through the complex bankruptcy process and help them get a fresh start in life. Once the debts are discharged in bankruptcy, they are no longer liable for those debts.

People who file for bankruptcy today are considerably more educated than they were just fifteen years ago. Bankruptcy is not itself supposed to be a problem. By design, it is meant to be a solution to the problem of financial distress. But like most policies, it is far from a perfect solution. Those who look to bankruptcy for easy relief will surely be disappointed. Never attempt to navigate the complex maze of US bankruptcy laws without the assistance of an experienced Orem Utah bankruptcy lawyer. You will regret it.

Orem Utah Bankruptcy Attorney Free Consultation

When you need legal help for a bankruptcy case in Orem Utah, call Ascent Law LLC (801) 676-5506 for your Free Consultation. We can help you with a chapter 7 bankruptcy. Chapter 13 Bankruptcy. Chapter 9 Bankruptcy. Chapter 11 Bankruptcy. Chapter 12 Bankruptcy. Motions for Relief from the Automatic Stay. Stopping Foreclosure. Commercial Real Estate. Residential Real Estate. And Much More. We Want to Help You.