What to Do - And Not to Do - In Consumer Bankruptcy
The legal right to a fresh start under the U.S. Bankruptcy Code comes with responsibilities. Even if you're not sure that bankruptcy's right for you, try to keep these ideas in mind as you deal with your debt problems. Following these do's and don'ts will protect your future ability to take full advantage of your rights under bankruptcy law.
For detailed advice about your situation and your options, there's no substitute for talking to an experienced bankruptcy attorney. Contact us at O'Bryan Law Offices in Louisville, Frankfort or New Albany to schedule a free consultation.
Important things to do while considering filing for bankruptcy
- Stay current on your payments on home mortgages or car loans, unless you are willing to give those assets up to the creditor
- Contact a lawyer before you make any major financial decision or commitment
- Sell assets for fair market value rather than deep discounts if you need to raise cash
- Make sure that your list of debts is complete and accurate, you can't discharge a debt that isn't listed on your bankruptcy schedules
- Be honest with your bankruptcy lawyer about your income and assets, otherwise you could jeopardize your discharge or even be indicted for bankruptcy fraud
Make sure you avoid these common bankruptcy mistakes
- Avoid using your credit cards for six months prior to filing for bankruptcy, especially for cash advances you might have to pay back an otherwise dischargeable debt
- Don't pay more than $600 on debts owed to family members
- Don't borrow from your 401(k) account to pay bills
- Don't pay down any unsecured credit within 90 days of your expected filing date
- Don't make more than one payment at a time on any debt if you're leaving other bills unpaid
- Don't try to shelter your assets by transferring them to others for less than fair value
Observing these do's and don'ts will help set you up to make the most of your right to debt relief under the Bankruptcy Code. For dependable advice about your own situation or particular debts, contact us at O'Bryan Law Offices at any of our Kentucky or Indiana locations.