A few years ago, when I realized that I couldn't pay my mortgage anymore, I knew that I needed to do something to correct my finances. It seemed like I just couldn't catch a break, and after losing my job, I knew that I was in trouble. I started looking for new work, but I knew that I needed to fix my credit somehow. I was at the end of my rope, until a friend talked with me about the possibility of declaring bankruptcy. She explained that it helped her to start over. I met with a bankruptcy attorney who was incredible to work with, and I was amazed at how much it helped my situation. Check out this blog to learn how working with a bankruptcy professional could help you.
Filing for bankruptcy may be the only option for many people when it comes to settling debts and other financial problems. However, there are many mistakes that people can make when filing for bankruptcy that can potentially ruin their chances at receiving a bankruptcy filing. Here are four mistakes that you must avoid when you are filing:
Giving Away Property: Before filing for bankruptcy, some people will transfer the title of some of their assets to other people, such as family members. This is considered suspicious activity when you file for bankruptcy soon after doing this and can lead to criminal charges against you. This is because you are considered to be hiding property from creditors who could've otherwise used those assets to help pay off your debts.
Paying Family Back: Before filing for bankruptcy, it may be tempting to pay your family back for any money that you owe them. However, you should be paying off creditors first. In fact, if you do give money to your family, the judge could file a charge to have this money returned to you in order to pay off creditors. It's best to wait to pay your family back after you file for bankruptcy and can receive the money that you need to do so.
Holding Back Information: When you meet with your bankruptcy attorney, you must disclose all your information to them. This includes what creditors you owe, whether or not you owe any taxes, and more. If you are holding back information and your attorney does not have the opportunity to address these financial issues to help you be granted the bankruptcy filing, then there is a chance that you could lose more of your assets, or even worse, have your case dismissed altogether, leaving you in the same financially challenging situation.
Taking Money from Retirement Accounts: Before filing for bankruptcy, it may be tempting to take money out of any retirement accounts that you have set up. However, this is something that you should be avoiding altogether, because when you take money from a retirement account, this money is not going to be protected. The judge can ask for this money to pay off your creditors. When you leave the money in your retirement account, it is protected and you will be able to keep that money for yourself when you need it. If you feel that you must pull money out of your retirement account, always talk with your attorney first before doing this.