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Before Bankruptcy Mistakes and Traps

Before Bankruptcy Mistakes and Traps
"""Filing for bankruptcy can be a difficult procedure, particularly for those who are unprepared. In fact, preparation is crucial in determining whether a bankruptcy case will succeed or fail. While you may believe that your participation in the process is minimal, you may be astonished to learn that there are a few things you can do to improve the outcome of your case. To maximize the success of your case, you need only avoid these common errors and pitfalls.

Not Represented

Although some individuals have successfully navigated the bankruptcy process on their own, employing a bankruptcy attorney can greatly improve your case. In addition to being well-versed in bankruptcy law, an attorney can review your specific case prior to filing to determine your eligibility and methods to improve your chances of success. Even if you do not wish to retain the services of an attorney throughout the entire process, you should at least consult with one prior to filing to ensure that you are pursuing the most appropriate debt relief option.

More Debt

Prior to declaring bankruptcy, the majority of individuals either intentionally or inadvertently incur additional debt. There are precise rules regarding the acquisition of debt prior to filing for bankruptcy, and violating these rules can have devastating effects on the success of a case. For instance, debts acquired within 90 days of filing that exceed $550 on a credit card or $825 in cash advances are ineligible for discharge. Whether these debts were incurred accidentally or on purpose, you may find yourself ineligible for bankruptcy or compelled to exclude them from the filing.

Moving Assets

One of the greatest apprehensions regarding bankruptcy is the possibility of losing assets. Although asset liquidation is uncommon, many individuals will go to extreme extent to prevent the loss of an asset. People frequently sell or transfer assets prior to registering for bankruptcy in an attempt to conceal them from the court. This is a poor idea and the court may even view it as fraud, which could result in the dismissal of your case. In bankruptcy filings, the concealment or transfer of assets is rigorously prohibited by law. However, the law does permit a debtor to sell an asset prior to filing if the debtor (1) obtains the asset's fair market value and (2) notifies the court of the sale in the filing.

Changing Finances

When preparing to file for bankruptcy, you may believe that eliminating certain debts will increase your chances of qualification. In actuality, this action produces the opposite result. The same applies to acquiring additional income or a second employment. If the bankruptcy court determines that your income is sufficient to repay your debts outside of bankruptcy or that your debts are insufficient, they will dismiss your case.

" - https://www.affordablecebu.com/

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"Before Bankruptcy Mistakes and Traps" was written by Mary under the Finance / Wealth category. It has been read 61 times and generated 0 comments. The article was created on and updated on 01 June 2023.
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