PROCEDURES AND “ADVANCE RETAINER LOAN” PROGRAM
Following is an overview of how Fresh Start Loan Corporation, dba Redemption Financial Services™ dba Replacement Financial Services™ handles the procedures for Redemption and Redemption Loans, including our new “Advance Retainer Loan” program. We believe these procedures serve to keep your time and that of your staff as efficient and effective as possible, and enable your client (who qualifies for a Redemption Loan) to retain your services for these purposes.
I.
Consultation and Referral (Don’t Waste Your Valuable Time!)
Provide your standard initial bankruptcy legal consultation and “spot the Redemption issue”. When you conduct the initial client interview and reviewing the debtor(s) secured auto loans (or other secured personal property loans) if you observe an “upside down” loan for a Chapter 7 case, ie., undersecured, (also cross-collateralization issues), provide your client with the appropriate legal advice and explanation about Redemption and a redemption loan as an option, or any other materials you may have.
Refer them to our office or web site. Providing your clients with our business card, Intake Information and Vehicle Details forms.
We’ll provide your client with a “Free” Good Faith Estimate (GFE). If the GFE shows (you’ll receive a copy as well) that it can NOT benefit your client with lower monthly payments over the same remaining term (and lower loan balance), then we will NOT be able to offer a Redemption loan.
If you would like to request a FREE Good Faith Estimate for your client, simply click on this link.
We’ll provide your client with a Credit Application for Loan Qualification (ie., if the GFE shows your client would benefit, and they would like to apply for a loan or see if they qualify); we will do all the work involved, “At No Charge To Your Client” in the Loan Qualification process. If your client does NOT qualify for a loan, then we will NOT be able to offer a Redemption Loan (we’ll copy you with the decision too).
Comment: The above steps still limit your firm’s time to the Initial Bankruptcy Legal Consultation that you would normally provide to a new client anyway. We do not want you to be wasting your valuable time if either the Good Faith Estimate or Loan Qualification process is not favorable. These steps are our work, not yours.
II.
Your Client Has Received A Favorable Good Faith Estimate and Loan Qualification and Wants To Redeem thru Your Legal Services. How Do You Get Paid Your Attorney Fees? – “Advance Retainer Loan” Program
Do you have in your bankruptcy fee agreement a provision that discusses your fees for Redemption services? Your client has been approved for a loan that will provide them an economic benefit, if you can perform the legal services relating to Redemption in their Chapter 7 case. These services are post-petition, and like other attorneys seeking to secure payment for such services, whether charging a flat fee or by the hour, a Retainer is usually desired over monthly billing, especially in cases dealing with consumer debtors. We suggest that your fee agreement include a provision that allows you to require a Retainer (a Post-Petition retainer), should your client’s request redemption legal services.
Request/Require a Retainer to Secure Your Legal Services; Consider Recommending To Your Client That They Apply For the “Advance Retainer Loan” Program. When your client desires to proceed, if you require or request a Retainer to secure your legal services, please also know that when your client was provided Loan Approval, they also qualified for our “Advance Retainer Loan” program. Under this program, although we do not agree to pay your attorney fees; we will finance, loan to your client, up to $800.00 in attorney fees in the redemption loan toward the amount of your fees. Your client executes our Advance Retainer Loan documents and we remit a check/loan for these purposes, payable to your client AND to your law firm. When the redemption order is received thru your post-retainer legal services and the redemption loan is funded, we incorporate (refinance) the Advance Retainer Loan into the Redemption Auto Loan and your client will have the one loan, the Redemption Loan. If, for any reason, the Redemption Loan fails to close, and thus does not fund or occur, eg,, your client decides to surrender the vehicle, or fails to timely provide proof of insurance under the loan approval conditions, your client will remain obligated to us under the terms and conditions of the Advance Retainer Loan.
Comments: There can be a number of reasons why your client’s redemption loan may not fund or close that have nothing to do with your services; but we can think of no reason why you should not receive payment toward your hard work! As is common practice for most attorneys, and especially consumer bankruptcy attorneys, a client retainer(s) for legal services is extremely important to secure assurance of payment. In a high volume consumer bankruptcy practice such as yours, where profit margins may very well prove beneficial only because of maintaining a large case volume with staff controls for effectiveness and efficiencies, there is no doubt that payment by clients for their legal services MUST be accounted for and paid at as close to 100% as possible, in order for you to remain profitable and to be able to continue to serve and provide the important benefit you offer to consumers who appreciate your professional abilities and the help and impact you make on improving and solving their legal problems.
For example, if after some, most, or all of your legal services, your client chose NOT to redeem, or otherwise failed in timely meeting a loan condition where we would not therefore provide the loan (eg., proof of insurance); without a retainer toward your time expended, you would be left to proceed with billing/collection from your client!
With a retainer, you secure payment for your services in advance of your work, regardless of the outcome. This is also an important boost to your cash flow because you do not have to wait until the loan funds in order to receive payment (for services you have already rendered); Note: the funding time frame can easily be as much as 30 to 45 days from the time you commence your services; ie., after all loan conditions are satisfied (including the court order on motion), and assumes your client will close the loan.
We defer completely to you on your decision whether to require a retainer from your client, to be paid from loan funding (assuming your client’s loan closes) or to bill your client. We also defer to you whether you charge a flat attorney fee for redemption legal services or an hourly rate (contested/additional services). These decisions are strictly between you and your client.
III.
Now That You Have a Fee Retainer, You Can Undertake the Legal Services* To Obtain a Redemption/Redemption Loan For Your Client In Chapter 7.
Working with the amount provided in the Loan Qualification as far as the value of the collateral, and supporting information provided to you by our office, including our Loan Conditions (eg., time from Order of Redemption to fund, Discharge Entered), as the attorney licensed to conduct professional legal services, on behalf of your client(s), the following legal action(s) are requested*:
If you would like to view sample legal forms taken from public records, simply click on this link.
Notice and Motion for Redemption and Proposed Order. Please note that we have seen situations where an Order that was entered on Default, due to no response, but was vacated because it was not served on the proper party, creditor, or authorized agent at the proper address; and/or
Contact the existing lender and/or their counsel for an Agreed Order; negotiate value of the collateral for redemption if contested; and/or
Hearing on Contested Motion for Redemption; and/or
We have also observed attorneys bringing the Motion for Redemption in Response to (or prior to likely) Relief from Stay Motions brought by the Existing Lender; and/or
Provide the Court with any Amended Attorney Fee Disclosure filing(s).
If the amount of the proposed Redemption is negotiated higher than our original Loan Qualification, or ordered at a contested hearing higher than our original lending approval qualification, YOU AND/OR YOUR CLIENT MUST contact us for an additional (free) Good Faith Estimate(s) and, if favorable estimates, to obtain additional authority from us for an increase in the Redemption amount, and/or additional attorneys fees. We will do our best to review the loan to qualify your client for additional lending amount(s); however, in some instances, either a higher redemption amount will not provide an overall economic benefit to your client (as shown by the revised Good Faith Estimate), or even if beneficial, your client may not qualify for additional Loan Qualification; thus no loan would occur/or be approved (at the higher amount).
Notify Us As Soon As Possible When the Order for Redemption Has Been Granted. We will then be sure your client has completed any remaining Loan Conditions (eg., proof of insurance, etc.) to complete the final loan process in the time frame prescribed (Court Order/Loan Conditions).
VI.
Redemption Loan Document Review and Funding
Upon notification from your office that the Redemption Order has been granted and that your client has completed/satisfied any remaining Loan Conditions, we will prepare the final loan documents for your clients and forward them to your office for review, by overnight delivery.
Have your clients execute the loan documents. After your clients have come into your office and you have reviewed and witnessed their signatures on the documents, you would return the signed documents to our office in the provided prepaid overnight packet.
We fund the Redemption Loan upon receipt of the loan documents executed by your client(s). We then forward the funds to the existing lender by overnight delivery and mail to your office any further authorized loan funds for additional attorney fees not previously advanced by the Advance Retainer Loan, if applicable.
Your Client(s) have a new, better, loan with us! Thru your legal services described above, and our Redemption loan to your client(s), your client(s) has a new loan, with a lower loan balance, lower monthly payments. Your client will be able to report established new credit.
On behalf of Fresh Start Loan Corporation, Redemption Financial Services™ and Replacement Financial Services™, we look forward to helping you represent your client(s) and hope we can “maximize” their fresh start in Chapter 7 bankruptcy.
* Please note that our General Counsel acts solely on behalf of, and represents the sole interests of Fresh Start Loan Corporation, dba Redemption Financial Services™ dba Replacement Financial Services™. We are not a law firm, nor licensed to practice law. The information and or forms, reference materials, etc., contained herein are for attorney reference only. Fresh Start Loan Corporation, dba Redemption Financial Services™ dba Replacement Financial Services™ does not provide you or your client with legal advice; we represent the lender, you represent the borrower. No attorney-client relationship is intended or implied; you and/or your client(s) are advised to seek out independent counsel for any an all legal advice upon which you or they intend to rely (other than upon your own legal advice), and no representation or warranty is made by Fresh Start Loan Corporation dba Redemption Financial Services™ dba Replacement Financial Services™ (or its General Counsel), whether expressed or implied, upon which you or your client(s) may rely upon as any form of legal advice.
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