While it is true that filing for bankruptcy can be a great way to get a financial fresh start, there is also the potential that this debt relief option can land you in some legal hot water if you make one of the common mistakes described below. Consequently, if you are considering filing a bankruptcy petition, you will want to take a few minutes to review these three things you should never do before you move forward with your request for bankruptcy relief.
#1: Never Take a DIY Approach
While you may think that you are being financially savvy by choosing to take a do-it-yourself approach to your bankruptcy petition, the fact is that you are more likely to cost yourself money in the long run by taking this approach. Bankruptcy laws can be quite complex and even a simple miscalculation or misunderstanding could result in your case being dismissed and you being barred from seeking bankruptcy relief for your current debts in the future. This is why you should consider hiring a bankruptcy lawyer if you plan on seeking this type of debt relief.
#2: Never Lie About Your Assets or Debts
It can be tempting to try and hide certain assets or even certain debts in order to ensure you qualify for Chapter 7 bankruptcy relief or to protect your assets from being seized. It is vital that you do not give into this temptation. Once you have filed your petition with the court, a bankruptcy trustee will be assigned to your case. This trustee will have full access to your financial records. With the high level of expertise that these trustees posses, you can be sure that they will uncover your dishonesty. Not only can this result in you being denied bankruptcy relief, but it could also result in you facing criminal charges for fraud. It is for this same reason that you should never attempt to transfer assets to a family member or friends prior to filing for bankruptcy simply as a means of trying to protect that asset from seizure.
#3: Stop Using Credit After Deciding to File for Bankruptcy
Far too many people make the bad decision to use up what available credit they have right before filing for bankruptcy relief. This is a very bad idea! Once you file paperwork with the court, your creditors will all be notified that you have filed for bankruptcy. If your creditor believes that you used credit knowing that you intended to file for bankruptcy, this information will be shared with the court. If the judge agrees with your creditor, you could find yourself needing to pay all of your credit card debt because it will be disqualified from the bankruptcy proceedings. You could also find yourself being charged with fraud as a result of your actions.Share