The decision to file for personal bankruptcy is not one which should be made arbitrarily. Instead, it should involve thorough research and extensive planning. Our experienced bankruptcy attorneys are sharing some key steps to take leading up to the filing process, as well as major mistakes to avoid.
Do: Explore Options
Bankruptcy is not the only debt relief solution available to borrowers in distress. For some, debt consolidation loans or debt management plans may be a more appropriate fix to money woes. A West Palm Beach bankruptcy attorney should walk the debtor through all potential options, then advise whether a personal bankruptcy is the right step to take to overcome his or her debts.
Do Not: Pay the Wrong People
In the time leading up to a bankruptcy filing, one has to be careful when paying off bills. The bankruptcy process can get extremely complicated if it is determined one has selectively repaid debts. For instance, it would be inadvisable to repay a loan from a relative, rather than paying one’s, other creditors. This would be viewed as a preferential transfer and could lead to the bankruptcy court using the relative who received the payment.
Do: Prepare the Necessary Paperwork
The paperwork to file a personal bankruptcy is extensive, and leaving out information or including inaccuracies could result in excessive delays, additional fees, a dismissal, and even criminal charges in severe cases. In addition to carefully filling out the bankruptcy forms, one will also need to gather any legal paperwork that is associated with the debts owed.
Do Not: Max Out Credit Cards
It goes without saying that an individual whose debts necessitated a bankruptcy filing should not continue to add to those debts, and yet this mistake is all too common. Excessive credit card bills in the months leading up to bankruptcy could result in the creditor alleging fraud and objecting the discharge, often successfully.
Do: Undergo Credit Counseling
Bankruptcy filers are required to attend two credit counseling sessions, one prior to filing and one before a discharge can be granted. The debtor must file bankruptcy within 180 days of completing the first session.
Do Not: Navigate the Process Alone
Enlisting a West Palm Beach bankruptcy attorney is an important step to take if one wants to avoid hiccups in the bankruptcy process. A lawyer can advise borrowers whether a bankruptcy discharge is within reach, as well as ensure critical mistakes are avoided throughout the process. Plus, an attorney can often protect filers from wage garnishments and bank levies even before filing.
Are you considering bankruptcy? Schedule a free consultation with one of our knowledgeable bankruptcy attorneys today to explore all of your options and begin working toward a debt-free future.