Consumer bankruptcy attorney Ed Boltz handpicked the WestEllerbee Creek Trail Tunnel under I-85 in Durham as the location for this story’s photoshoot.
“Bankruptcy is a process of taking people who are in a dark tunnel of debt and financial distress and bringing them out into the light of a new start,” said Boltz, the managing partner at the Law Offices of John T. Orcutt, P.C.
Bankruptcy may play a role in personal injury cases and family law cases as well as criminal, real estate, and estate planning matters, among others. Boltz’s message to lawyers handling these cases is to loop in a bankruptcy attorney as soon as possible.
“A lot of times, non-bankruptcy attorneys are unfamiliar or scared of bankruptcy and do not recognize how filing can actually make things easier for their clients and for the attorney as well,” said Boltz.
“The earlier they come in, the better. Consumers have messy lives. They don’t fit into boxes. So, talking to us now helps because the client is not as far behind, and it’s easier to solve a smaller problem than a bigger problem.”
The Law Offices of John T. Orcutt always offer a free consultation. “We call ourselves bankruptcy attorneys because it’s the main thing we do, but I like to explain that we’re really financial distress attorneys,” he explained.
“When people come in to see us, we give them options. Here’s what you can do to avoid bankruptcy. Here’s what a bankruptcy would look like right now. Here’s how we can plan to have a better bankruptcy in a month or three months based on taking this cash that you have and putting it towards the right things rather than the wrong things.”
The Low Ball Offer
Boltz outlined a scenario where a woman was injured, and her car was badly damaged when she was t-boned by a driver who ran a stop sign. She retained a personal injury lawyer who said her case was worth $250,000.
The woman couldn’t afford to get her car fixed. So, she lost her job because she couldn’t get to work. Her medical bills and regular bills were piling up, and creditors were calling her non-stop. Based on her financial condition, the insurance company offered her a low-ball settlement of $50,000, which she jumped at because of the tremendous pressure from her bills and debt collectors.
“Filing a bankruptcy can relieve that stress so she wouldn’t have had to worry about her bills,” said Boltz. “Here in North Carolina, after filing bankruptcy, you keep control of the lawsuit, and the client keeps the entire residual settlement. That’s one of the things that some personal injury lawyers don’t always fully grasp.
“By filing for bankruptcy, she could have wiped out her debts, waited out the insurance company and got $250,000 to cover her lawyer’s contingency fee, pay her medical bills and get a new car.”
Then the client would have kept the entire remaining settlement for herself, to take care of her family in the future, rather than her bills and debts.
The Financial Honeymoon
A married couple with financial problems contemplated a divorce when a family attorney suggested they talk with Boltz. “You could feel the tension between the husband and the wife when they came in for their first meeting. They said the phone was always ringing. They were fighting over how they were going to make the mortgage payment,” he recalled. “We filed bankruptcy, and the pressure came off. We saw them six weeks later at a court hearing, and they were holding hands because they’d had another honeymoon, a financial honeymoon.”
Boltz said that most family lawyers can see when a client may be headed for bankruptcy long before the client realizes it. “A bankruptcy attorney can make sure the client’s equitable distribution order and property settlements are drafted in ways to protect them from bankruptcy,” explained Boltz.
“When a divorcing couple is fighting about debts, a bankruptcy can make child support payments affordable, where before they were both struggling to take care of their children because they had so many other creditors calling to get paid.
“Sometimes these cases get resolved because the divorce attorneys don’t want to be sucked into bankruptcy court. They’d be in front of judges they don’t know with a whole set of rules that are different than the state court rules, and they don’t know how they’ll get paid,” said Boltz. “That’s where we can help.”
Finding the Right Solution
Bankruptcy is not the solution for every situation. Boltz and his firm analyze every client’s case for all of their options, but many people in financial distress later have told him that filing bankruptcy was “the best thing I ever did.” Although bankruptcy can have an adverse impact on credit scores, that effect is temporary and often comes after the damage has already been done.
It’s not uncommon for someone with financial problems to try to tough it out. “If you see the writing on the wall for one of your clients, you should recommend they talk with a bankruptcy attorney,” said Boltz.
“I see people all the time who were unsuccessful with a debt consolidation company. They are uniformly worse off than if they would have come to us sooner. A lot of times, they’ve paid money, including large fees to the debt settlement company, and gotten nothing for it.”
To make things worse, Boltz explained that these companies only deal with credit card debt and not with medical debt, payday loans, car loans, mortgages, or student loans. “On top of that, their credit score is taking a further beating, and the harassment from creditors doesn’t stop.”
“We want attorneys to understand that the point of bankruptcy is to eliminate debt, to help clients keep and protect their home and vehicles and put people in control of the creditors for a change, so that they can get on with their lives and enjoy the fresh, new start that only bankruptcy can provide,” Boltz explained.
Top of the Game
The Law Offices of John T. Orcutt is one of the largest bankruptcy law firms in North Carolina, with 12 lawyers and more than 60 paralegals and support staff, and offices throughout the state.
Boltz acknowledged that the firm’s ubiquitous TV commercials and ads can give it a bad rap with more staid and traditional lawyers as a high-volume bankruptcy operation, inaccurately thinking clients will have little interaction with an attorney. “We want lawyers to know we are a very efficient system like a BMW or Lexus factory, providing a high-quality service.”
“I have incredibly experienced paralegals, who not only interact with clients to gather details about creditors and assets but have such kindness and compassion that they make what can be a daunting process as easy as possible,” said Boltz.
He explained that this lets the lawyers deal with the big issues in a client’s case without being bogged down. “We’re able to focus on finding new solutions for the problems our clients are facing, like student loans and mortgage issues.”
One of the attorneys is a litigation lawyer who handles violations of the Fair Debt Collection Practices Act and other consumer protection laws. “When creditors step over the line in their collection activities, we bring lawsuits against them on our client’s behalf.”
Boltz has served on the Board of Directors of the National Association of Consumer Bankruptcy Attorneys since 2006 and served as its president, testifying on two occasions before Congress about the need for bankruptcy reform. “The firm’s lawyers and I speak at conferences throughout North Carolina and all over the country teaching other bankruptcy lawyers. I’m confident we are at the top of the bankruptcy game nationally, not just here in the state.”