One of the first steps to take when considering the different options available to you is to determine your totally debt. When you are in a situation where you are experiencing stress financially, it may be tempting to do whatever you can to free yourself from that pressure. However, bankruptcy discharge is a very serious, legal action therefore it is crucial that you understand what is going to happen before, during, and after bankruptcy.
Don’t Rush
Bankruptcy is a federally governed method of debt elimination. There are limitations on how often you can file for bankruptcy.- Chapter 7 bankruptcy discharge is something that can only be done once every eight years.
- Chapter 13 bankruptcy discharge is something that can only be done once every six years.
Don’t Wait Too Long
There are times however that bankruptcy can’t wait and that it is in your best interest to file for bankruptcy right away. If a wage garnishing is in place, it is important to file sooner rather than later so that you have more money to pay bills. Filing for bankruptcy in a timely manner is also important if a creditor has a lawsuit against you. Your bankruptcy attorney will want to make sure to look at the complaint to see if it includes any allegations of fraud. If it does, the matter will go into judgment and you likely won’t be able to wipe out this debt in bankruptcy.A creditor that has won money in a judgement against you, the lien that accompanies it allows the creditor to take wages directly from your check, attach to your bank accounts, repo cars, and foreclose on your home in an effort to reclaim the money that is owed. If you file for and receive a bankruptcy discharge before the creditor wins a case against you, filing bankruptcy will stop the lawsuit in its track and wipe out that debt as well.
Don’t Drain Retirements Account
Retirement funds are protected from bankruptcy. It is important not to withdrawal funds from your retirement accounts in order to pay off debts. Before taking money from any type of account that is labeled for retirement speak with a bankruptcy lawyer to figure out the best option for you. Most often you will find that your attorney will recommend that you do not deplete your accounts to better your financial situation.Don’t Provide Information That Is Inaccurate
It is crucial to be completely open when it comes to your bankruptcy paperwork. You are required to provide accurate information on your paperwork including your assets, debt, income, expenses, and financial history. Misrepresenting information could lead to penalty of perjury.Don’t Add in New Debt or Move Assets
Any debt that is incurred seventy to ninety days before filing bankruptcy paperwork, unless it is a necessity, a creditor may object. Debt within this time frame may be considered fraudulent. As a rule, don’t take out cash advances or use credit cards to buy luxury items. It is also critical that you don’t try to hide or move assets for safekeeping before filing for bankruptcy. If you have sold property to pay for expenses before declaring bankruptcy it will be important to document the way in which you spent the money to pay for necessities.As with any legal procedure it is important that the rules are followed to prevent any sort of confusion when it comes to discharging your debt.
Bohikian Law Group specializes in bankruptcy services including chapter 7 and 13 bankruptcy. More information can be found at http://bohikianlaw.com.