Mistakes to Avoid When Thinking of Filing For Bankruptcy

There are certain mistakes you have to avoid while filing for bankruptcy. 

• Do Not Run Up Your Credit Cards – Any debt in excess of $500.00 incurred within 90 days from filing bankruptcy are considered non-dischargeable and you probably may have to hold on to this debt. Cash advances of more than $750.00 made within 70 days of filing are also considered non-dischargeable and may be found due and owing.
• Don’t Repay Any Family Members – The bankruptcy trustee can reclaim any amount you paid to a family member within one (1) year from filing bankruptcy.
• Do Not Cash Out Your Retirement Accounts – Retirement accounts are exempt from the trustee when you file bankruptcy. You can usually eliminate your debts and keep what you have in an ERISA qualified account.
• Do Not Transfer Any Property Out of Your Name – Your duty is to disclose all of your assets to the trustee and your estate belongs to the trustee once filing bankruptcy. The trustee will undo any such transfers made within two (2) years prior to filing a bankruptcy.
• Do Not Try To Reduce Your Home’s Equity – There is a homestead exemption, which you can keep your home and equity, and still file bankruptcy.
• Do Not Fail to Appear at Court Proceedings – You must appear to any court proceedings that you are instructed to attend.
• You Must Tell Your Lawyer the Truth – You must provide your lawyer all necessary information. If you fail to disclose any assets you could lose them, your bankruptcy case can be dismissed, you could be fined, and you can end up in prison for bankruptcy fraud.
• Never Manipulate, Lie or Defraud or Break the Law Using these Processes – Never see bankruptcy as a relief from being caught or getting out of being in the bad, negative spiral of escalating debt.
• Never do a Bankruptcy Yourself – You should always hire a legal representative who knows the bankruptcy process to give you advice.
• Do Not Increase Your Pay by Working Overtime or Getting a Second Job – If you earn over your state’s median income, you may have to file for a Chapter 13 than a Chapter 7.
• Do Not Adjust Your Exemptions, Allowing You to Earn a Higher Income – This can prevent you from filing a Chapter 7 bankruptcy and have to consider a Chapter 13 instead.
• Do Not Sell Your Assets – This could prevent you from being able to exempt the asset, which would have allowed you to keep the asset even after the bankruptcy discharge, protecting it from your creditors.
• Do Not Wait Until the Last Minute to File: Once you realize that your expenses exceed your income, you may have to stop and think for an alternative. At that time, bankruptcy could be considered an option.
• Never Ignore Any Lawsuits – This is important information the attorney needs to know.

To learn more about bankruptcy and whether it is an option for you, please feel free to contact a the Law Offices of Alon Darvish. They are experienced and knowledgable about Chapter 7 and Chapter 13 bankruptcy . 

Remember, if you are considering on filing for bankruptcy, consult a San Diego Bankruptcy Lawyer. They know the ins and outs of filing for bankruptcy. Don’t leave it to chance with something so important. 

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