In “Rich Famous, and Stars of Prime Time”, a recent U.S. News and World Report discussed Oprah’s success and quotes Oprah herself: “If there’s a thread running through each show we do, it’s that ‘You are not alone’.” Reporter Amy Bernstein comments, “It is OK for Oprah’s viewers …to share their pain with her and to divulge their weaknesses because there is nothing she has not seen…”

As a bankruptcy attorney in Indiana for almost twenty five years, I hope to bring that same message to my bankruptcy clients and blog readers.  It’s absolutely true – it’s OK to share your pain and divulge your weaknesses because there’s nothing (at least it seems that way to me) I have not seen or heard in the area of finances and debts and the legal issues surrounding debts.  I like to say I’m in the “fresh start” business, helping my clients  focus on the future, on “What’s next?”, instead of focusing on regrets about the past.  And, whether it’s about foreclosure issues, or car repossession, individual bankruptcy, small business bankruptcy, or student loan debt, the message is the same – let’s focus on the “now” and on the future.

The magazine story says that “For Oprah, Martha, and the Donald, their first names are enough.”   Well, I know that even both names of Mark Zuckerberg aren’t enough for instant worldwide recognition, but that’s just fine.  My professional life is devoted to working at bankruptcy court and counseling tens of thousands of people in my offices around the state of Indiana, very far from the Silver Screen and the Golden Stage.  But my messages – they’re right up there along with Oprah’s:  “YOU ARE NOT ALONE.” And “THERE IS HELP’. 

Just ten short years ago, singer and songwriter Toni Braxton was singing a sad tune as she filed Chapter 7 bankruptcy in Los Angeles.  Toni's fans were shocked, because her albums had enjoyed such success, but it was that very success that led to problems.  Braxton filed a lawsuit against her recording company, because she felt the terms of her contract were no longer fair.  The LaFace company countersued, and the only way Toni could halt the endless legal battles was to declare bankruptcy.  While waiting for the negotiations to end, Toni played Belle in Disney's Beauty and The Beast on Broadway. 

As an Indianapolis bankruptcy lawyer, I enjoy learning about famous people who were able to move past the dark periods in their careers and go forward to achieve success.  While my Indiana bankruptcy clients are very rarely stars, Toni Braxton's story brings out a message I try to convey to all my clients:  Bankruptcy is not the end of everything; in fact, it signals a fresh beginning and a new chance at personal and business success.

 In the years following her bankruptcy, Toni Braxton recorded seven new albums, earning no fewer than six Grammy Awards.  She appeared in a movie and in a TV sitcom.  And this very month, almost exactly ten years after her 1998 "downer", Toni is appearing in her own Las Vegas spectacular, complete with her own band, amazing costumes and tens of backup singers and dancers.  Rags to riches?  Not exactly.  Hers is more like a riches to rags to riches story.

Two weeks ago, Mastercard brought out its earnings report, which was very good - and, looked at from a consumer's standpoint, not so good.  The company's profits were way up, in good part due to card use by travelers and customers overseas.  Here in the U.S. card use was up 10 percent for the last quarter of 2007 as compared with a year earlier.

The most interesting part of the report to me was that, while consumers are charging more on their credit cards, Mastercard reports that they are spending less on luxuries and more on necessities, using credit cards to purchase groceries, personal health care items, and gasoline, even medical and dental costs not covered by insurance.  Mastercard pointed out that there was less spending on things such as jewelry, restaurants, and furniture. The report went on to say that Americans are paying down their credit card balances at a slower rate.  

I must tell you that, as a bankruptcy lawyer in Indianapolis and in three other Indiana cities, I was not surprised by this Mastercard report.  Every day I meet with people who are squeezed financially and who have been forced deeper into debt, including credit card debt, just to stay ahead of everyday bills. Then I read another report, this one from the Bureau of Labor Statistics, saying that applications for unemployment benefits soared to the highest they've been since 2005.

Two pieces of advice might be useful here:  Even if you need to use a credit card to keep the bills paid, make sure to avoid late payments on the credit card .  Not only will the credit card company impose high fees, the interest rate on the entire balance could skyrocket immediately, making the situation incomparably worse.  Second, if you see your debt situation rapidly deteriorating, get help right away from an attorney specializing in debt help.   Waiting can only make things worse.

There's More To Filing Bankruptcy Than Filling Out Forms

Many people have the mistaken idea that all that's needed to file bankruptcy is filling out a bunch of forms, paying a fee, and submitting the paperwork to the court.  Sounds simple and cost-saving, doesn't it?  Unfortunately, that description is very far from the realities of the bankruptcy world.  Now, since I'm a bankruptcy attorney in Indiana, you might say, "Well, sure Zuckerberg would say you need an attorney to help file bankruptcy!"

There's a feature story in Marketplace Money about one U.S. bankruptcy court that was so concerned about the mistakes debtors were making when they filed without using an attorney, it created a special position for a clerk to help people not represented by counsel.  This clerk, when interviewed for the story, expressed her frustration.  Since, even though she works for the court, she is not allowed to give legal advice, much of her time is spent trying to persuade petitioners to hire an attorney to help them.

Does the law require you to have an attorney?  Not at all!  You can even find the forms you need online.  Keep in mind, though, there's an awful lot to the process - the timing of the different steps, the requirements, the terminology.  People filing bankruptcy are already under quite a bit of stress.  It's hardly the time for them to get educated in a complex area of the law, especially when mistakes can have such serious results!

I often tell people who ask me whether they should try to file on their own: "You could do your own open heart surgery - but would you?"