There are some things that you should avoid before filing bankruptcy.
- Don’t lie to your bankruptcy attorney or fail to disclose assets.
Your bankruptcy attorney can only help you if you answer all of their questions completely and honestly, and this includes full disclosure of assets. Clients are often surprised that what they thought was a major barrier to filing bankruptcy can be resolved by an experienced bankruptcy attorney, but remember, your attorney can’t help you if you aren’t honest with them.
- Don’t sell, give away, or transfer any property before you file bankruptcy.
One of the questions on the bankruptcy petition is whether you have sold, given away or transferred any property within the four years prior to filing bankruptcy. You have to answer this question under oath, and if you lie you could be charged with criminal bankruptcy fraud and have your discharge denied. Always talk to an experienced bankruptcy attorney before you make any rash decisions to sell, give away or transfer a valuable asset. This includes selling your car to your best friend for $10, ‘giving’ cash to your son to hold for you, or transferring your house to your mom. The worst thing that you can do is to try to hide an asset from the bankruptcy court. [separator type=’transparent’ color=” thickness=” up=’10’ down=’10’]
- Liquidate or borrow against a 401k, IRA, or other retirement account
Most retirement accounts are exempt assets, which means that neither your creditors nor the bankruptcy trustee have any claim to these accounts. Debt consolidation companies are notorious for getting debtors to liquidate retirement accounts to pay debts that would have been exempt in a bankruptcy case. The end result is that the debt consolidation company collects big fees while the debtor not only loses their retirement account but also is faced with a big tax bill. Before you liquidate or borrow against your 401k, IRA or other retirement account, talk to an experienced bankruptcy attorney.\
- Charge on Your Credit Cards When You Know You Are Filing Bankruptcy
Charging on your credit cards when you are considering filing bankruptcy or after you have decided to file bankruptcy is one of the worst things you can do. Creditors will check your account history once you they have received notice of your bankruptcy case and in certain situations can ask the bankruptcy court to deny your discharge if the charges were made right before your case was filed.
- Get married or move in with someone
If you have overwhelming debt or are considering filing bankruptcy, always talk to an experienced bankruptcy attorney before getting married or moving in with a significant other as this may affect your eligibility to file under Chapter 7.
Avoid mistakes that could sabotage your financial future. Consult with an experienced Georgia bankruptcy attorney and get the facts about whether filing bankruptcy is right for you. Call (404) 800-9939 to schedule your free initial consultation at either our Lawrenceville or Atlanta location.
TERMS OF USE & DISCLAIMER: The content of this website is for informational purposes only and does not, nor is it intended to, create an attorney-client relationship between The Ballard Law Group and the viewer. Bankruptcy is a complex area of law and it is strongly recommended that you consult an attorney for advice regarding your individual situation.