Bankruptcy can bring immeasurable relief when you are overwhelmed by debts. Of course, the decision to declare bankruptcy is always a difficult one to make. However, bankruptcy can give you a fresh start when your creditors are on your neck.
To realize the benefits that come with bankruptcy, it is important that you get it right from start to finish. Avoiding bankruptcy mistakes can ensure that your case goes smoother and that you get the outcome you desire.
Here are costly mistakes that you need to steer clear of when filing for bankruptcy.
Choosing the wrong bankruptcy
Chapter 7 is sometimes called a “liquidation” bankruptcy (although most people who qualify for this plan don’t actually have any assets, they’re likely to lose) and Chapter 13 is a “reorganization” bankruptcy that gives you the ability to retain assets that might otherwise be sold. It’s important to find out which version you qualify for so that you understand your options. Everyone’s situation is different. Talk to an attorney who can evaluate your situation and steer you to the best form of bankruptcy for you.
Waiting too long to file
If you are aware of the financial difficulty, you are going through, one of the serious mistakes you can make is to take too long before declaring bankruptcy. Most often, you will save a substantial amount of money if you address the matter as soon as it becomes apparent that you are struggling with debt.
Hiding assets before you file
Some people may be tempted to transfer assets like the home into someone else’s name prior to declaring bankruptcy. It is important to understand that the deliberate transfer of assets out of your name can be considered fraud by the bankruptcy court.
Bankruptcy mistakes can delay or hurt your case. Find out how you can declare bankruptcy without jeopardizing your rights.