Whether your attorney is asking you in person at their office or on a form she provided you with, here you are: Include the names, addresses, account numbers, and amounts owed to each creditor. You've been making minimum payments on the one credit card that isn't """"maxed out"""" to prevent it from falling into default. You would like to retain it because you need some credit in case of an emergency.
Most creditors, particularly large banks that issue Visa, Master Card, Discover, and American Express, check your credit report every few months, if not every month. Eventually, it will be evident that you filed for bankruptcy because it will appear on your credit report.
What do you believe the credit card issuer will do then? Will you be permitted to retain your card? Will they extend you additional credit? Not even close! Not during your lifetime! You have significantly complicated matters for yourself and your counsel through your actions.
Instead, you should disclose, disclose, disclose. When your attorney requests that you enumerate all of your debts, you must do so. There are justifications for every inquiry. Many are requested because they are obligatory. However, many more questions are requested so that your lawyer can protect you.
Mistake No. 2: Omitting to Mention You Repaid a Relative.
Any competent bankruptcy attorney will inquire whether you have repaid any debts to family members within the past year or two. Each jurisdiction is a little bit unique. However, the concept is that you do not wish to create a ""preference.""
In a typical state, if you repaid a parent, sibling, or sibling's spouse within the year preceding the filing of your case, you created a preference. Consider that you had credit card debt, unpaid medical expenses, and a loan from a relative. This family member is a creditor in the same category as credit cards and medical expenses, but you paid them before the others, creating a preference.
Guess what happens if the quantity exceeded $600! The trustee may retain the funds and use them to repay all of your case's unsecured creditors proportionally. Obviously, the trustee receives a commission for this.
What To Do Rather. Tell your counsel. If you inform him before filing your case, he may be able to assist you or the family member you paid keep that money. The objective is to keep it out of the trustee's hands. The timing of your lawsuit filing can be crucial. This is an excellent illustration. By possibly delaying until the end of the year, that preference payment may become irrelevant.
Third Error: Letting Too Much Time Pass Between Your Initial Consultation with Your Lawyer and the Filing of Your Case.
There is so much to say about this error that it is impossible to cover everything here. However, as an illustration, your attorney will request your six-month gross income. You will provide her with this information, but will not see her for six weeks. Consequently, you will need to provide additional information to follow up, as time has passed and those six months are now different than they were previously.
What You Should Do Instead: Since the bankruptcy code examines your life in """"snapshots"""", no one is to blame. Nevertheless, existence is lived continuously. It progresses day by day, and things evolve as time passes. The best course of action is to delay and provide your attorney with all the necessary information at once. However, this is the optimum. ""We must all do the best we can.""
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