Making Ch. 7 Bankruptcy Decisions that Work for You
While it’s certainly true that no one really wants to file bankruptcy, the hard truth is that sometimes it’s necessary. If you find yourself considering such a move, it’s helpful to be cognizant of some of the decisions coming your way and the things you can do to make it easier on yourself, or significantly more difficult.
1- Recognize that bankruptcy is a legal process. That means mistakes or dishonesty could result in major fines, a dismissal of your case, and real time behind bars. Go into the whole thing with a plan to be forthright.
2- You really will benefit from the help of a bankruptcy attorney. Bankruptcy law is pretty convoluted to the average consumer, and there are things you will likely not know or understand without the benefit of legal analysis. To drill down the point, it’s worth knowing that only about five out of every self-represented cases of bankruptcy are successful.
3- Cooperate fully with the bankruptcy trustee. If you go with a Chapter 7 bankruptcy, you will be subject to a means test, meaning you’ll have to disclose all income and assets so a determination can be made as to your ability to repay creditors. The trustee will have access to your financial data, so if you try to withhold anything, it’s ultimately going to show up and get you into trouble.
4- Along the lines of being honest, it’s important that you understand that bankruptcy courts have seen every attempt to hide assets there is. You may think you’re being clever by giving your big screen tv to your sister to use for a while and taking it back when the whole bankruptcy process is behind you, but you’re not the first to try such shenanigans, and it’s likely just going to buy you more trouble. The same goes for transferring assets to family. It’s illegal to sign your car over to your brother in order to protect it from bankruptcy.
5- While it may be tempting to go ahead and rack up a bunch of debt prior to filing for bankruptcy, that’s really an irresponsible move that looks pretty suspicious to bankruptcy courts. So give up on the plan for one last lavish vacation before you have to live more frugally.
6- Leave your retirement accounts alone! Your 401(k), IRA, Keogh plan, pension plan, and similar savings are exempt from bankruptcy, meaning neither creditors nor the trustee can get their hands on them. Once you pull the cash out, though, it’s another story. So be smart and keep that money safe and sound.
The Help You Need
At The Law Office of Julia Kefalinos, our dedicated Miami bankruptcy attorneys provide non-judgmental, efficient, and practical assistance through what’s generally considered an unpleasant financial process. We do what we can to lessen the stress of bankruptcy. Schedule a confidential consultation in our office today.