Bankruptcy is not a process to be entered into lightly. This is because bankruptcy can have a significant impact on a number of different aspects of your life. While bankruptcy can ultimately be advantageous to some people and offer them an opportunity to rebuild their credit, for others the bankruptcy process is much less pleasant. The following will review some of the common mistakes people make when filing for bankruptcy. Our hope is that you will avoid making these mistakes in the future.
Accruing Great Amounts of Debt Before Filing for Bankruptcy
Some people figure that if they are going to file for bankruptcy, it will not hurt to accrue a great amount of debt immediately beforehand. In reality, a person will almost certainly be required to repay these debts. Instead, if you decide to file for bankruptcy, you should immediately stop using all of your credit cards.
Transferring Assets Before Filing for Bankruptcy
Transferring property, vehicles, or other assets out of your name will not help you when filing for bankruptcy. While these transfers might not always result in additional complications, they can get you in some trouble. Speak with a knowledgeable bankruptcy attorney before moving any assets.
Retaining a Lawyer Without Bankruptcy Experience
Bankruptcy is a unique and complex area of law. Furthermore, bankruptcy laws are constantly changing. Unfortunately, some people think that obtaining a general practice lawyer is just as good, which is rarely true. Instead, it is critical to obtain the services of an experienced bankruptcy attorney who understands this process and who has helped numerous other people navigate the system.
Failing to List All of Your Assets or All of Your Debts
When filing for bankruptcy, it is critical to list all of the assets to which your name is attached. Not only can failure to list all of these assets result in serious complications, in some cases, failure to list assets can also lead to charges of bankruptcy fraud, which can result in serious penalties.
When filing for bankruptcy, it is also important to list all of your creditors. While a bankruptcy attorney can inform you how much you will be required to pay each party, if you do not tell them to whom money is owed, this will substantially impact the advice that the bankruptcy attorney will be able to provide.
Paying Back Friends or Family Before Filing for Bankruptcy
In situations in which a person attempts to pay off personal debts before filing for bankruptcy, courts are known to pursue the amount in question from friends or family. If you are truly experiencing financial difficulties, then you should not worry about repaying anyone before filing for bankruptcy.
Speak with an Experienced Bankruptcy Lawyer
While the bankruptcy process is not for everyone, for some people it is one of the best decisions that they will ever make. If you are interested in navigating the bankruptcy process, you should not hesitate to obtain the assistance of an experienced bankruptcy lawyer. Contact the Adam Law Group today to schedule an initial free case evaluation.