I recently wrote an article about what not to do if you think you might file bankruptcy. About halfway through the article I realized that there is a lot of information on this topic, so I divided it into two parts. The following list consists of what not to do if you intend to file bankruptcy.
1. Do not use your credit cards during the 90 days prior to filing bankruptcy. If you use your credit cards during the 90 days prior to filing bankruptcy, the lender may sue you in bankruptcy court to have the debt ordered to be nondischargable. This means that the debt will not be affected by the bankruptcy discharge and you may also be liable for the attorney’s fees incurred by the lender.
2. Do not file if you anticipate an inheritance or some other type of financial windfall within the next year. If you become entitled to a financial windfall, such as an inheritance, within six months of filing bankruptcy, the trustee may be able to take that money and pay it to your creditors.
3. Do not file bankruptcy if someone owes you money and you have a reasonable expectation of getting paid. In this type of situation you have to weigh the amount of money you are owed and the likelihood of getting paid against your need to file bankruptcy. The trustee can require that the money paid to you be given to the trustee and paid to your creditors. If it is not a large amount of money, then it may not have any effect on your decision of when to file bankruptcy. But if it is a significant amount of money you may want to wait until you receive the money and exempt as much of it as you can.
This is not an exhaustive list of things not to do prior to filing bankruptcy. I have tried to address the most common situations I see in my bankruptcy practice, but there are many other issues that can arise. The best advice I can give you is to consult with a bankruptcy attorney the moment you make the decision to file bankruptcy, so that they can advise you on your specific situation.
Leave a Reply