What Mistakes Should I Avoid When Filing for Bankruptcy?

man in distress

Deciding to file for bankruptcy may place you in a rather vulnerable position. With this, you do not want to do anything that would jeopardize this opportunity at having a financial refresh. Read on to discover what mistakes you should avoid when filing for bankruptcy and how a seasoned Rockland County bankruptcy attorney at The Law Offices of Allen A. Kolber, Esq. can help you steer clear of them.

What mistakes should I steer clear of when filing for bankruptcy?

One common mistake that you should steer clear of is using your credit cards in excess after filing for bankruptcy. For example, if you owe a single creditor $500 or more in luxury goods or services within 90 days of filing, the New York bankruptcy court will consider this a non-dischargeable debt. Meaning, the New York bankruptcy court will not wipe out this debt. In addition, if you owe $700 or more in cash advances within 70 days of filing, the court will also consider this a non-dischargeable debt.

Another common mistake to avoid is liquidating your valuable assets to pay off your debt. For one, you should not liquidate your retirement account. This is because these accounts are generally protected during this process. Secondly, you should not take out a line of credit or a second mortgage against your real estate. This is because you will likely not lose your home during this process, but taking out additional loans may just put it at risk.

What other mistakes should I avoid?

There are other common mistakes that are made during the bankruptcy filing process. They are as follows:

  • Repaying a family member before you pay back your legitimate creditors.
  • Transferring your property out of your name to hinder, delay, or defraud your creditors.
  • Failing to appear at state or federal court proceedings regarding collection cases pending against you.

With all that being said, the biggest mistake of all would be not retaining the legal services of a competent Rockland County bankruptcy attorney. With this, you must be willing to tell us the whole truth regarding your assets. We can only provide advice that is in your best interest if we know the full extent of your circumstances. What’s more, doing so will help you avoid the loss of these assets, the denial of your bankruptcy case, fines, or even imprisonment.

All in all, the odds are that we have handled cases just like yours. So pick up the phone to schedule your initial consultation with us today.