Missteps of Filing for Personal Bankruptcy
When filing for personal bankruptcy, you might believe that only fraud can prevent you from successfully discharging your debts. However, there are a number of missteps you can take on the path to a clear financial slate. Therefore, if you want to successfully file for personal bankruptcy, here are the most popular missteps that will throw a wrench in your plans.
Going on a Gambling Spree
Bankruptcy courts don't look kindly on frivolous spending, especially when you're in the process of filing for bankruptcy. Therefore, even a trip to the local casino for a fun night out can get your bankruptcy case thrown out. And don't think you can hide the evidence from the courts: since they have full access to your finances, it's bound to be revealed sooner or later.
Don't wait for the moment when the banks are foreclosing on your home, or almost all of your paycheck is being garnished to pay off your debts, to file for a personal bankruptcy. This harried decision will almost certainly result in filing mistakes, which can eventually get your case thrown out of the bankruptcy courts. Bankruptcy should be approached logically and carefully, so don't wait until the last minute to file.
Leaving Out Cars and Car Loans
Don't leave out your cars when filing for bankruptcy, as they are considered assets. And whatever you do, definitely don't transfer the title of a car to another relative, as this will certainly be reflected in your financials - thereby guaranteeing that you can lose the car.
Additionally, be sure to let your car lenders know that you've filed for bankruptcy. Most federal bankruptcy laws allow you to keep your car, but you'll have to follow your lender requirements to do so. If you don't, there is a chance you will end up losing your car.
We briefly touched on transferring assets in the last section, but this point can't be emphasized enough: don't transfer assets before filing for bankruptcy. Not only is it a guarantee that you'll get your bankruptcy petition thrown out, but it's also illegal. If you're concerned that you'll lose a particular asset during the bankruptcy process (such as your house or car), then ask your bankruptcy attorney how you can protect that asset.
If you want to successfully file for bankruptcy and get your debts discharged, be sure to avoid these missteps!