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Bankruptcy Mistakes to Avoid

If you’ve decided to file bankruptcy or if you’re seriously thinking about it, you want to do whatever it takes to ensure a smooth and efficient experience. Remember, during the filing process you’re dealing with the federal bankruptcy laws; therefore, you do not want to make a mistake that will bar you from enjoying bankruptcy relief.

“Do people really make bankruptcy mistakes?” It happens all the time. They don’t understand the laws and what’s expected of them, so they go out and charge up all of their credit cards or transfer assets in hopes of hiding them from the bankruptcy trustee. The thing is, the bankruptcy courts are accustomed to these unscrupulous tactics and they are on guard for such activities committed by debtors.

If you decide to file for Chapter 7 or Chapter 13 bankruptcy, avoid making these common bankruptcy mistakes!

1. Maxing out your credit cards. Have $10,000 worth of available credit that you’re dying to spend on front-row tickets to your favorite concert, a Mexican cruise, or perhaps a few days at a luxury spa before you file bankruptcy? Our advice – don’t. When you file bankruptcy, you may not be able to discharge credit card debt that’s associated with unnecessary luxury items, such as those listed above. This could apply to cash advances as well, so be careful about your spending.

2. Concealing your assets. This is one of the most serious bankruptcy crimes that is prosecuted on a regular basis. If you transfer assets before or during the bankruptcy process, or if you make an attempt to conceal them with the intention of keeping them untouchable to creditors or out of your bankruptcy estate, you can face fines and imprisonment.

3. Bribing the bankruptcy trustee, the judge, or a court employee. This one needs no explanation.

4. Failing to show up to the Meeting of Creditors. If you file for bankruptcy, you will be required to attend the Meeting of Creditors and it will be scheduled during normal business hours. If you cannot show for any reason, contact your bankruptcy attorney and see if you can attend over the phone. The courts have accommodated people who moved to another state or country, or who were in jail, or on military deployment.

If you are interested in learning more about the bankruptcy process, a bankruptcy attorney from Nguyen Law Group can help. Contact us today to schedule a free consultation – we gladly serve clients in Rancho Cucamonga and Mission Viejo.