When faced with a pile of debt, you often begin wondering what you can do to get out of a bad situation quickly. You are worried about who is knocking on the door, calling your phone and coming to your work. Bill collectors can be ruthless and annoying, especially when they are trying to collect on a piece of collateral that you have in your possession. To help put an end to the madness and regain control of your life, many people turn to bankruptcy to start over. While bankruptcy has a lot of benefits to it, there are also certain rules that you need to follow to make sure you don't jeopardize the outcome of your case.
Don't Pay Off Debts to Family Members
When you pay family members a bunch of money before you file your bankruptcy case, the trustee sees that as a preferential payment and can demand the family member pay that money to the court. Not only could you cause problems with your bankruptcy case, but you could also cause a rift with family members. After all, what family member wants to be forced to give up money they thought was theirs? The best thing you can do is hold off paying anyone anything until after your case has been decided.
Don't Rack up a Bunch of Debt Before Filing Your Case
Many people figure that they might as well rack up a bunch of debt since they are going to file for bankruptcy anyway and they won't have to pay for it. That isn't the case. You cannot go out, rack up a bunch of debt and go file for bankruptcy as a way to erase your poor spending habits. It simply doesn't work that way.
The bankruptcy attorney will be able to advise you as to what the rules and regulations are in regards to your debt and how old the debt has to be. The best thing you can do when you are already drowning in debt is to stop adding more to the pile. Don't make a bad situation worse by going out and getting more credit. The court isn't going to look too fondly on that situation.
Take a few minutes to discuss everything with your lawyer to make sure you are on the same page. You don't want to do something that could cost you the discharge of debt that you seek. For more information, contact a firm such as Abakhan & Associates Inc.Share
21 November 2014