Making the choice to file for bankruptcy is a serious one. This is why you should, at all costs, not make any mistakes that will complicate your proceedings. Read on to discover what mistakes you should avoid before your bankruptcy filing and how a seasoned Orange County consumer bankruptcy lawyer at The Law Offices of Michael D. Pinsky, P.C. can support you.
What are common mistakes that I should avoid before filing for bankruptcy?
First of all, you should stop using your credit cards once you decide to file for bankruptcy. This is because more than $500 worth of debt owed to a single creditor within 90 days of filing for bankruptcy will be considered a nondischargeable debt. Meaning, that they cannot be eliminated by your bankruptcy. The same goes for cash advances worth more than $750 within 70 days of filing for bankruptcy. Ultimately, running up your credit cards will defeat the point of your attempt to get out of credit card debt through your bankruptcy filing.
In addition, you should stop repaying your family members, friends, or coworkers that you borrowed money from before you file for bankruptcy. This is because a bankruptcy trustee can reclaim any amount repaid to an outside party within one year of filing for bankruptcy. Ultimately, making repayments beforehand will defeat the point of your attempt to pay off debts through your bankruptcy filing.
With all that being said, more common mistakes that you should avoid include the following:
- Avoid draining your retirement accounts to pay off your debt.
- Avoid taking out additional lines of credit to pay off your debt.
- Avoid taking out a second mortgage on your home to pay off your debt.
- Avoid transferring your property out of your name within two years of filing for bankruptcy.
- Do not miss court proceedings regarding collections pending against you before filing for bankruptcy.
- Do not lie to your attorney about what assets you have while filing for bankruptcy.
How can an Orange County consumer bankruptcy lawyer help me?
Along with the mistakes mentioned above, another mistake you will want to avoid is filing for the wrong bankruptcy option (i.e., Chapter 7 bankruptcy, Chapter 11 bankruptcy, or Chapter 13 bankruptcy). Rest assured, a competent Orange County consumer bankruptcy lawyer is ready and willing to step up and help you make this determination. From here, we will stick by you every step of the way.
You can trust our decades of experience when it comes to bankruptcy proceedings. To discuss your legal options, reach out to our firm today. You will want to schedule your initial consultation with us before it is too late. We look forward to hearing from you.