Filing for bankruptcy is probably one of the biggest decisions you’ll ever make in your life. While your lawyer would help you throughout the entire process, there are some major DON’Ts that you shouldn’t do, lest you want to derail your bankruptcy case. Here’s the top five:
1. DON’T Wait Too Long to File
Having substantial debt could impact your life negatively. Late payments turn into collection accounts, while collection account could turn into wage garnishments. Put simply, you need to research your options the minute you realize that you’re no longer capable of repaying your debts.
2. DON’T Conceal Assets.
It’s normal to be tempted into hiding your assets, perhaps through transferring cash to a relative’s account or a bank account in another country, but just DON’T. Doing so before filing for bankruptcy would jeopardize your discharge, not to mention get you in trouble with the law and land you in prison for bankruptcy fraud, warns bankruptcy lawyers in Salt Lake City.
3. DON’T Hide your Creditors.
Whether you forgot about some creditors because you’re stressed or you deliberately tried not to disclose some of your creditors, the circumstances won’t matter to the court because you’re required to list down each and every one of your creditors when you file. Otherwise, your debt to the creditor that you mistakenly or deliberately omitted won’t be discharged.
4. DON’T Go on a Shopping Spree.
Planning on charging huge purchases on your credit card because you’ll soon be filing for bankruptcy anyway? DON’T. It’s highly likely that the bankruptcy court won’t discharge these charges because you made them knowing that you’re about to go bankrupt.
5. DON’T Repay Debts to Family.
It’s great that you want to do the right thing for your family and pay what you owe them so your debt won’t be discharged. But your bankruptcy trustee, the one who will be tasked by the court to oversee your case, might deem your repayments as biased and decide to disallow them. When this happens, your family member might even need to pay back the money to your trustee.
Keep these bankruptcy DON’Ts in mind before you file for bankruptcy to help make certain that your case goes through as smoothly and quickly as possible. Or else, your bankruptcy case could last for a long time or you might be denied the discharge that you’re looking to receive. What’s worse, you might also have to pay a hefty fine and spend time in federal prison.