What Not To Do Before Filing For Bankruptcy
Bankruptcy can be a life-changing experience. However, if you are deep in debt with no way of paying back the creditors, then it might be your only option left. Bankruptcy is often kept as a last resort for obvious reasons. However, there are a few things you should avoid doing right before filing for bankruptcy if you want the process to go smoothly.
Too many people attempt to take advantage of bankruptcy by obtaining large amounts of credit right before filing a case. The courts do not take kindly to that. Mistakes like this can worsen your financial situation. Speak to an attorney to file for Bankruptcy in Orlando.
What not to do before filing for bankruptcy
- Lying about your assets.
When you file for Chapter 7 bankruptcy in Orlando, it requires you to reveal all your own. The court first attempts to pay off the creditors by liquidating your assets and then proceeds to the discharge process. If you try to hide assets to prevent the court from liquidating them and you get caught, your case could be dismissed. The truth eventually comes out in such scenarios, so do not think that your deception will go unnoticed.
- Transfer money or property.
Other than lying about assets, what people do is transfer their money and property to the accounts of their relatives or other people they trust. You might be mistaken if you believe this will protect your property from the court. What is worse is that the court might call you a fraud even if you did not have the intention to hide assets.
Additionally, just because you file for bankruptcy does not mean you will lose all your assets. Some of your personal assets still remain with you, so there is no reason to hide them.
- Do not use your retirement account to pay off debts.
If you are worried about the court draining your retirement account, you may stop worrying now. Your retirement accounts are protected in Chapter 7 bankruptcy. Therefore, if you are considering emptying your account to pay off the debtors, do not make this mistake. This is money you have saved for your future, so hold on to it properly.
- Not consulting an attorney.
Bankruptcy law is too complicated. The average person does not have enough knowledge to carry out the different tasks involved in filing a case. Attorneys can protect you from legal liability and educate you on legal ways to protect your assets. It might be tempting to want to do it on your own and save money since you are already in debt, but it is not worth it to put your financial state at risk.