The U.S. Trustee Program has finally blessed bifurcated Chapter 7 bankruptcies, as long as they’re done properly!

Here’s the key sentence from the bombshell memo sent to all the U.S. Trustees on June 10th by Ramona D. Elliott, Acting Director of the U.S. Trustee Program:

Absent contrary local authority, it is the USTP’s position that bifurcated fee agreements are permissible so long as the fees charged under the agreements are fair and reasonable, the agreements are entered into with the debtor’s fully informed consent, and the agreements are adequately disclosed.

So in this podcast episode, I give my overall reaction to this apparent paradigm shift in the UST’s attitude towards bifurcation. Also, it’s a five page memo with 22 footnotes, so I also want to review the USTP’s new positions on all the little things that make bankruptcy such a detail-oriented practice.

Most important, for the first time ever, the USTP is actually giving us a perfect roadmap to follow so that we can offer bifurcated Chapter 7 in bankruptcies 100% safely!

So it’s very important that in the new USTP memo, the USTP articulates for the first time its position on many of these specific issues involved in bifurcation. So all we need to do now is understand the USTP positions and act accordingly, and we’ll be able to offer bifurcated chapter 7 bankruptcies safely , without worry that our local UST will come after us.

So with that in mind, this podcast episode reviews the 14 positions that the USTP articulates in its memo, and lays out that perfect roadmap for any bankruptcy lawyer to follow!

This is the second part of a 2-part episode that answers a simple question:

Are bifurcated Chapter 7s actually legal?

In the first part, I went over 5 specific mistakes that you need to avoid in order to “bulletproof” your bifurcated Chapter 7s from a US Trustee.

In this second part, I update these 5 mistakes with lessons that I’ve learned over the last 2 and a half years, as well as some new case law. In fact, I even added a new mistake based on a recent case out of Missouri (see In re Allen).

If you’ve ever wondered if bifurcated Chapter 7s are actually legal or not, this is the episode for you.

The surprising truth is that after a tidal wave of legal innovation, many bankruptcy lawyers routinely offer zero down Chapter 7s. You just have to follow the arcane rules involving bifurcating your cases into prepetition and postpetition portions. And as it turns out, no judge has ever ruled that a Chapter 7 cannot be bifurcated, so long as it’s done correctly.

This is part 1 of a 2-part episode, where we start by busting the top three bifurcation myths, including:

1. Why bifurcated Chapter 7s do NOT violate the automatic stay or discharge injunction, even though you’re collecting money postpetition from debtors
2. How “saddling” poor debtors with a postpetition payment plan for a bifurcated bankruptcy is way better than the alternative of no traditional bankruptcy at all
3. Why it’s a total myth that there are many US Trustee enforcement actions that prove that bifurcated Chapter 7s are illegal

I also go over the 5 specific mistakes you need to avoid in order to get into hot water with the US Trustee.

It’s been two years since I recorded an episode of Bankruptcy Law Success, so I want to explain where I’ve been.

The short answer is that I’ve been on a journey to find an infallible system that any bankruptcy attorney can use to create a practice that frees debtors from the shackles of debt, while also generating a healthy 7-figure income.

In this episode of Bankruptcy Law Success, I interview Jake Parent, a sales genius who developed a sales script that’s so effective that it can convert 80% of appointments into retained bankruptcy clients. In fact, it’s so effective that I call it the “Irresistible Bankruptcy Sales Script.”

If you’re a bankruptcy lawyer that’s not converting 80% of your appointments, you need to stop what you’re doing and listen to this podcast. Then you need to listen to it again. And then you need to practice the sales script obsessively and use it for every bankruptcy consultation.

In this episode of Bankruptcy Law Success, I interview Don Golden, a bankruptcy attorney in Brandon, Florida who dominates his local Google “map pack” and files about 40 bankruptcies a month.

In this interview, Don is remarkably candid about how his bankruptcy practice was hobbled by Google’s Penguin update, and how he turned things around by obsessively tracking his numbers and building systems. These are my favorite kinds of interviews, because when bankruptcy attorneys “listens” to their numbers, they end up inventing all sorts of awesome ideas that we can steal…

Some of the highlights in this interview include:

In this episode of Bankruptcy Law Success, I interview Dan Garrison, a bankruptcy attorney who co-founded Fresh Start Funding with Matt Hartley to help other attorneys offer zero-down Chapter 7s.

I learned two things talking to Dan. First, after talking to Dan, I am much more confident that bankruptcy attorneys should go ahead and offer zero-down Chapter 7s today, as long as they do it properly as described in this interview. (I was more wary before.)

Second, I was impressed by Fresh Start’s “mid-single digit” default rate, as well as its revenue share being up to 75% of post-petition fees.

One last thing… In this interview, Dan talks about practices growing by 25-30% after implementing zero-down Chapter 7s. I think Dan is being fairly conservative. From what I’m seeing, once you figure out how to sell zero-down bankruptcies (and you figure out your marketing), you can double or triple your filings.

Some of the highlights in this interview include:

In this episode of Bankruptcy Law Success, I interview Steven Skelton, a trained salesperson who answers the phone for his bankruptcy attorney clients.

Steven has spent his career in sales, even before he started helping his wife, Susan Skelton, increase sales at her bankruptcy practice. Simply by exercising his sales muscles, he was able to help his wife’s practice go from a one-room subleased office, to become a consistent top-10 filer in the Eastern District of Missouri.

Some of the highlights in this interview include:

In this episode of Bankruptcy Law Success, I interview Michael Hoverson, a bankruptcy lawyer in Minneapolis who has filed bankruptcies for 31 years. Over the years, he’s also noticed that there are many debts that bankruptcy completely ignores.

So he’s learned legal techniques to slay these “zombie debts,” like student loans and tax debts. That’s one reason he’s been able to spend less on marketing, yet still keep busy in a shrinking bankruptcy market.

Some of the highlights in this interview include:

In this episode of Bankruptcy Law Success, I interview Mike Ziegler of Clearwater, Florida, a bankruptcy attorney who does more than just bankruptcies. In fact, in addition to foreclosure defense, Mike offers an “alphabet soup” of consumer plaintiffs’ claims, including FCRA, FDCPA and TCPA.

Mike has blazed a new trail for bankruptcy attorneys who aren’t scared of litigation. And since consumer plaintiff’s claims pay more than bankruptcy filings, it’s easier to make more money doing it, too. In this remarkably candid interview, Mike explains exactly what he does, how he makes money doing it, and how you can do it too.

Some of the highlights in this interview include: