The Dos and Don’ts of Filing for Bankruptcy
What a person does before and during the process of filing for bankruptcy is more important than most might realize. For a better idea of what to do – and not do – during your bankruptcy journey, here are do’s and don’ts of filing for bankruptcy. Take each into consideration as you plan for the path to rebuilding your financial future:
What to Do
Before you file and while you are in the process thereof, there are several things you will need to do or consider. These include:
- Keep and file all of your statements and collection letters
- Record all collection attempts by creditors or collection agencies
- Remain current with secured claims if you intend to keep those assets
- Wait before filing for bankruptcy if you are expecting to receive a large sum of money, such as from an inheritance or an auto insurance claim.
- Consider a non-profit, debt-management alternative to bankruptcy before filing.
What Not to Do
Just as there are things you should do during bankruptcy, there are also things to avoid. Here are just a few:
- Do not repay debts to close friends, family members, or those with whom you have personal relationships.
- Do not transfer assets to hide or protect them.
- Do not continue using credit cards for cash advances or purchases once bankruptcy has been filed.
- Do not sell any assets for less than fair market value.
- Do not file for bankruptcy if you anticipate a large sum of money via a tax return or other source of income.
- You should also avoid paying expenses for adult family members before filing for bankruptcy, although there are exceptions to this rule.
There are many more do and don’t tips that cannot be listed in a brief blog. That does not mean they are not important, though; the wrong choices before and during filing can dramatically impact your bankruptcy case and could even lead to a denial of bankruptcy or loss of assets.
To access the most comprehensive list of tips – and the information that is most relevant to you and your unique situation – the best course of action is to speak to a legal professional. Assuming that you cannot afford the cost of hiring an attorney is a mistake. Many offer free consultations and experts agree that the benefit of knowledgeable legal guidance far outweighs the cost.
For more information on bankruptcy assistance in your area, speak to the professionals at the Office of Larry P. Karandreas, PLLC. With no fee for consultations and honest and upfront cost estimates that help clients plan, we can help you make the right decisions on your path to financial freedom through bankruptcy.