Full disclosure

Brad Perri is a Minnesota bankruptcy lawyer who will be guest blogging at Caveat Emptor from September 29th through October 10th.

So you’ve done some research: you have read about bankruptcy at your local library and you have talked to a few bankruptcy attorneys. Hopefully, you have found one you think you would like to work with.

Now what?

Disclose everything. What do you own? What have you owned in the past? Do you have any big bonuses coming to you in the near future? What debt are you most ashamed about? Do you owe any family members who you would like to pay back? Did you run up your credit cards at the casino?

You need to work with an attorney who you can disclose all of this to. Why? Because the person on the opposite side from you (called a trustee; we’ll talk about the mechanics of a bankruptcy tomorrow) is doing all kinds of stuff, like background checks, asset checks, and credit checks to determine exactly what you own, what you owe, and how to take as much of what you have to pay off your debts.

The only way that your attorney can do the job that you hired your attorney to do is if you give your attorney all the information they need to know. Otherwise, you are going into battle with some serious problems. Do not do that to yourself. Do not let the creditors make you feel guilty, because that is when you won’t want to disclose something to your attorney. Your attorney can only help you if you tell your attorney everything.

Remember: what you and your attorney discuss when you are seeking legal advice is protected by the attorney-client privilege. If you like, ask your attorney to explain to you what that means. You will probably feel much better and much more at ease in disclosing to your attorney everything needed to properly prepare your case.

Your attorney will help you to do this by giving you some worksheets to fill in regarding what you own and what you owe. You shouldn’t hesitate to ask your attorney for help in reading these worksheets and filling them out.

The single biggest mistake you can make if you decide to pursue your financial options in bankruptcy is to try to hide something, whether it’s from your attorney or the trustee. The single biggest thing you can do to secure your success is to disclose everything to your attorney.

Tomorrow, we’ll take a very overview of the mechanics of the bankruptcy process itself.