Struggling with debt for a significant period of time can take its toll. It can leave you stressed, overwhelmed and hopeless about your future. We know that’s a lot to deal with as you fight to find a way to get by on a daily basis, but we also don’t want to see you struggle any more than you have to. That’s why if you’re ready to finally break free of the binds of suppressing debt, now is the time to consider pursuing personal bankruptcy.
With that said, if you’re going to use the bankruptcy process to secure debt relief, you need to do so in the right way. Although bankruptcy might provide you with the fresh financial start that you want, making some common mistakes can jeopardize your bankruptcy petition and the future that you hope to obtain.
Therefore, before moving forward with your bankruptcy filing, you should make yourself aware of some common mistakes so that you know how to adequately avoid them.
Common bankruptcy mistakes to avoid
There are a lot of mistakes that you can make as you navigate your bankruptcy. Here are some that could put your case at risk:
- Accumulating large amounts of debt leading up to your filing: Some people think that if they can discharge their debt in bankruptcy, they might as well use up all of their credit and rely on as much debt as possible leading up to the filing of their bankruptcy case. But this can be risky given that a quick accumulation of debt leading up to your filing opens the door for your creditors to challenge the discharge of your debt.
- Trying to transfer property: Depending on the type of bankruptcy that you seek, you might have to sell some of your assets to pay off creditors as fully as possible. Some people try to keep more of their assets than they should by transferring property to family members and friends. This very well could run afoul of the law and put your bankruptcy case at risk. Instead of transferring property, you should consider how to best use existing bankruptcy exemptions or a Chapter 13 filing to protect your assets and your financial interests.
- Hiding assets: Similarly, some individuals try to hide their assets to remove them from the bankruptcy process. Again, this violates the law and may deny you the debt relief that you seek.
- Using exempt property to pay off debts: It’s natural to have an urge to pay off the debt that you’ve accumulated as fully as possible. But don’t dip into exempt property, like your retirement accounts, to pay off your debts before filing for bankruptcy. This is just throwing money away since those debts very well may be discharged through the bankruptcy process.
- Delaying your filing: You shouldn’t face hardship any longer than necessary. But pride often drives individuals to avoid bankruptcy for as long as possible. This just leads to more stress and more financial harm than is necessary. Therefore, if you think that you have overwhelming debt, now may be the time for you to consider bankruptcy.
Do you have more questions about the bankruptcy process?
There are a lot of nuances to the bankruptcy process. If you want to ensure that you can leverage the process to your advantage as much as possible, you need to know how to navigate these intricacies.
Fortunately, you don’t have to do that on your own. Instead, you can work closely with an experienced bankruptcy law professional who can help guide you throughout the process so that you stand a better chance of ridding yourself of crushing debt and securing the fresh start that you deserve.