Tracy Coyle — Legal Practice Pro

7 Reasons to Use a Virtual Bankruptcy Assistant Instead of Hiring a Staff Member

September 1, 2009 By Tracy Coyle

3195909_fc7d917402

I am a big fan of productivity. Improvements in productivity almost always result in better profitability – regardless of the business or practice. In general, productivity improvement occurs in two ways: more output for the same input; the same output for less input.

You get more output for the same input by using experience to increase flexibility in job processes and improving efficiency and accuracy.

Getting the same output for less input requires lowering operating costs such as overhead, reducing the need for extensive training periods and lowering personnel costs.

Getting more output for less input is the goal of any manager and hiring a virtual bankruptcy assistant (VBA) is one way to do so!

More Output for the Same Input

1. Flexibility. Most offices and staffs can handle a short term increase in client load but we are looking at steadily climbing filings into the near and intermediate future. Can you determine whether the current increase will persist long enough to justify a long term addition to your staff? A VBA works when business circumstances warrant the need. You are not obligating yourself to a long term commitment to an employee when the future is uncertain.

2. Efficiency and accuracy. Your staff has to handle a wide variety of tasks including dealing with clients; having them focused for hours at a time preparing petitions keeps them from responding to office needs as they occur. The VBA is focused on your petitions. I like to believe that every VBA turns over an error free petition every time. I know better. After more than 1000 petitions, I still miss an occasional item. Despite the occasional missed detail, an experienced VBA can catch small problems before they become big ones. Catching a fraudulent tax return or a recent large lump sum payment can prevent extra work or even litigation. For efficiency and accuracy, experience matters.

3. Experience. In a previous post, I suggested that an appropriate level of experience for a VBA is the equivalent case load you experience over five years. Can you hire a staff member with extensive experience? Maybe. And with all due respect to Jay, they will cost more than $12 per hour. Most VBAs have years of experience in the bankruptcy field and have prepared hundreds of petitions. One of the best reasons to use an experienced VBA is how little training is required.

Same Output for Less Input

4. Training. VBAs are ready to start working on day one. Whether it is the software or changing rules and forms, the VBA maintains their knowledge levels, on their time. While a VBA needs to learn some of your forms, methods and preferences, they already have experience learning multiple methods. With few exceptions, training time and expense will be carried by the VBA.

5. Cost. As Jay has pointed out in how much should you pay a VBA, a VBA can cost less than having a staff member prepare a petition. Your first task is to determine what your in-house cost is so that you have a comparison to work from when talking to a VBA. It is not just the wage/salary and associated costs, but also, the overhead costs.

6. Overhead. Software, computers, space. I had a discussion once with an attorney that complained he still needed the software, still needed the computer and still needed the staff to handle the intake and deal with the issues raised in the preparation process. I agreed. I then asked him if he obtained four more clients a week, would he be able to deal with them utilizing his current infrastructure? Can you? Adding staff means using more space. If your current space is already fully utilized it could mean crowding, or the expense of changing locations.

7. Location. Location, location. Ever think there are too many attorneys practicing bankruptcy in your geographic location? No? Ever wonder where you might find someone with bankruptcy experience if there are few bankruptcy attorneys that have already trained their staff? Finding a bankruptcy assistant can be fairly easy in a market like New York or Los Angeles. In Madison Wisconsin, we basically all know one another and the bankruptcy attorneys. When you are considering a virtual bankruptcy assistant, you are able to pull from a workforce that is nationwide in scope and often, nationwide in experience.

The VBA is a specialist. The most time consuming and least client oriented task in your office is the petition preparation. Utilizing the skill and experience of a VBA can improve the productivity and profitability of your practice.

Tracy Coyle is a virtual bankruptcy assistant working with consumer bankruptcy lawyers nationwide. She can be contacted by email at tracy.coyle@gmail.com.

Photo courtesy of roberlan.

_{»crosslinked«}

Filed Under: Outsourcing

Five Questions to Ask a Virtual Bankruptcy Assistant

July 24, 2009 By Tracy Coyle

As business people we are faced with hiring decisions all the time. The initial appointment with a potential client should answer two questions: can I help this person with their issues? Can we work together? A potential client that is evasive, irritating, frustrating and combative at the initial appointment is not likely to improve over time.

If you are considering hiring a Virtual Bankruptcy Assistant (VBA) the initial discussion should also answer two questions: can this person help me and my practice? Can we work together?

Over time you have developed a series of questions that helps you get to the issues and feel out a potential client. When I talk to a potential client, there are five areas I expect to discuss. An attorney that does not cover these areas is likely to be frustrating and difficult to work with over time. Here are five questions that I have been asked and expect from a potential client:

1. [Quantity] How many petitions have you prepared?

Volume is important. The more situations a VBA has dealt with, the more potential issues they will be aware of in new cases. What is a good answer? I think it depends on YOUR practice. If you handle 30-50 cases a year, after four or five years, you probably consider yourself experienced enough to deal with your potential client base. A VBA that has done 150 to 250 cases is probably a reasonable experience level for your practice size. A high volume practitioner that handles 200 or more cases per year will probably consider a thousand cases as a minimum level of experience. Matching your volume for five years to the VBA’s numerical experience will probably give you a VBA that can handle many of the issues likely to come up in YOUR practice.

2. [Breadth] What type of cases have you handled?

A VBA that has never handled a Chapter 13 case has seldom had to face the issues that asset cases address. It is like a car mechanic that has never dealt with a manual transmission. Chapter 7s, Chapter 13s, individuals, couples, same sex couples, sole proprietorships, federal and state exemption rules, multiple districts and multiple attorneys gives a VBA a vast array of experience that improves the quality of their work.

3. [Depth] What type of information do you provide when you return a petition?

A VBA should offer a comprehensive list of concerns, missing items and legal issues. The issues can be as simple as they were missing one paystub in the last sixty days to ‘Did you know they had $22,000 deposited in their checking account two months ago and it was withdrawn the next day?’ Seeing a lien on a car title but the creditor wasn’t listed in the schedules; A married couple with no jewelry listed on Schedule B and two jewelry store credit cards with large balances on Schedule F.

A report of the issues and concerns raised during the preparation of a petition gives attorneys two vital pieces of information: issues to be aware of in front of a Trustee and how forthright a client is in their discussions. A VBA should never assume an attorney knows what is missing or what issues exist. Most attorneys are aware of the credit counseling requirement but listing the absence of a credit counseling certificate in every case where it is missing is the job of the VBA. It gives the attorney confidence that when they sit down in a 341 hearing, the Trustee is not going to ‘surprise’ them.

There is one other area/issue that a VBA should not be afraid to advise the Attorney about: legal issues. I may get some flack about it, but a good VBA knows the rules and the law. I am not suggesting the VBA tell the Attorney HOW to practice bankruptcy law, but when a client has not lived in a state for two years, noting that different exemptions apply is part of our job. Legal issues will be rare, but they are 800 pound gorillas and catching them before a Trustee does makes a VBA invaluable to an Attorney.

4. [Performance] What is your turnaround time?

A nuts and bolts question? A VBA that answers ‘within 24 hours’ or ‘within 48 hours’, probably has a low volume business – nothing wrong with that, but the answer should be consistent with the answer in question number one. An answer of 7-10 days either indicates an extremely busy VBA business (and then you want to be careful with quality) or a VBA with other obligations (a regular job?). In the end, it is an issue of YOUR practice. If you routinely plan to file petitions quickly after obtaining the information from the client, a long turn around will impact your business processes. Also, if it is normal to file all your cases in the first week of the month, having longer turn around times may not impact your practice at all. A VBA should always offer that if you have an emergency filing, they will do their best to turnaround the petition as quickly as possible.

5. [Quality] What documents do you need to prepare a petition?

Most attorneys have a booklet or set of papers that a client fills out with the information necessary for the petition. That booklet is a foundation, but far from enough to complete a quality petition. In addition to the booklet, at a minimum: deed(s), title(s), 2 years of tax returns, 3 months of bank statements, 3 months of financial and creditor statements (especially secured debts); 6 months of pay stubs; any summons/complaints for lawsuits; credit counseling certificate. (I prefer and review 6 months of financial statements. 90 days covers SOFA #3 but could be an issue on balance transfers – our trustees ask about balance transfers over the last 120 days.)

VBAs that ask for less are not bad, but you need to compare the amount of information provided to the VBA with the detail expected back from them. A reasonable inquiry applies to all the steps in the preparation and filing of a bankruptcy petition. We have seen at 341 hearings the result of debtors filing their own petitions. VBAs that take only the minimum information provided and prepare a petition from it will fare no better.

A VBA that requests a significant quantity of documents is more likely to return a petition that accurately reflects the debtors financial condition, but reviewing such a load of documentation will take much longer also – expect to pay for it.

Those are the important five. They cover quantity, quality, depth, breath and performance. You will ask other questions as the discussion evolves.

But, you might notice there is no discussion of cost: how much do you charge? If you get good answers to the above questions, pay whatever the VBA asks. It will be worth it. When you bill clients for staff work, the amount is more than you actually pay the staff. The number reflects the overhead costs and carrying costs of having staff performing necessary work. The VBA provides their own computer, facilities, training and overhead. The VBA only gets paid when you need them, whenever you need them. No staff member would accept four hours of work this week, then sitting at home unpaid for 10 days.

Consider the amount of time you (or your staff) spend preparing petitions and then multiply that by your staff billing rate. It will be a reasonable starting point for fee negotiations with a quality VBA.

Tracy Coyle is a virtual bankruptcy assistant working with consumer bankruptcy lawyers nationwide. She can be contacted by email at tracy.coyle@gmail.com.

What Is A Virtual Bankruptcy Assistant?

July 9, 2009 By Tracy Coyle

Ignore the ‘virtual’ part for a moment: What is a bankruptcy assistant? Your right hand. An experienced bankruptcy assistant knows client intake, petition preparation, trustee quirks, court rules and the issues common to bankruptcy. Depending on the experience and needs of the consumer bankruptcy practice (CBP), a bankruptcy assistant will work with clients from their first contact til long after the discharge is granted.

In every successful bankruptcy practice there must be at least one experienced assistant capable of discussing a client case at any stage of the process with a trustee, a creditor’s attorney or court staff.

If you were around in 2005, everyone knew that the rush to file before the law took effect was going to temporarily overwhelm even the best office staffs and systems. We knew that it was a short term spike. Today, we are approaching pre-2005 filing levels and the phones are ringing off the hook and clients are coming out of the woodwork. This is not a short term spike. For the foreseeable future, consumer bankruptcy filings are going to continue to grow into record territory.

Your choices are few: find additional experienced staff; hire and train someone capable of learning; or contract out some of the workload. Or you could just pay overtime for the next year or so to your current staff and hope you can keep burnout to a minimum – for you and them.

Coming back to the ‘virtual’; it does not mean some disembodied head on a computer screen. Virtual assistants (VAs) are there when you need them and not there taking up space and money when you don’t. They can be in the same building or in a different state. VAs can handle the simple to the complex; petition preparation to research for briefs.

Yes, I said it. Petition preparation can be a simple task. Just like changing the oil in your car, hitting a golf ball, or pulling a tooth, it is the experience level of the person doing the task that makes it look easy.

At a basic level, your clients are hiring you for your knowledge and experience. VAs are hired for exactly the same reasons. For the most part, there is no training time, no learning curve. VAs hit the ground running, they contribute from the first hour of work. Tapping into that level of experience is the primary benefit of working with VAs.

Whether you need an assistant for an hour a month, or 10 hours a week, VAs give your business the flexibility to adjust to changing business situations and access to experience levels seldom found in temp agencies.

As the court system pushes ECF to it’s limits, a CBP lends itself to using technology for more and more work. The VA takes advantage of technology to improve the productivity and profitability of your practice.

Tracy Coyle is a virtual bankruptcy assistant working with consumer bankruptcy lawyers nationwide. She can be contacted by email at tracy.coyle@gmail.com.