4 Things You Shouldn't Do If Considering Bankruptcy

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4 Things You Shouldn't Do If Considering Bankruptcy

14 June 2017
 Categories: Finance & Money, Blog

If you are in a difficult financial situation, filing for bankruptcy may be something you are considering to help wipe your debts. Bankruptcy is not cut and dry, though, so it's important that you are careful with your financial dealings to ensure that once you are ready to file for bankruptcy, it can go as smoothly as possible. Here are four things you should not do if you are considering bankruptcy:

  1. Transferring Assets: If you are thinking about filing for bankruptcy, you should definitely not transfer any assets. Even if you were planning on doing it anyway, it's better to wait because it could be seen as fraud, which you will be responsible for. This could really affect you when filing for bankruptcy. 
  2. Paying Off Creditors: When you file for bankruptcy, your debt is going to be wiped away. If you start paying off your creditors, you are putting money into something that is going to go away anyway. This money should instead be saved for the process of filing bankruptcy and for your time trying to get back up on your feet after filing. 
  3. Using Credit Cards: Even though you are having financial problems, it's important to stop using your credit cards altogether if you are going to be filing for bankruptcy. The reason for this is that it can be seen as potential fraud by maxing your credit cards just to have them wiped off. This also means potentially losing more assets in order to pay for your bankruptcy. 
  4. Depositing Extra Money: The only money going into your bank account should be money from your source of income. If you receive a gift from a friend or make some side money for small jobs, you should not deposit it into your bank account because this could be seen as fraud, as well. On top of this, the money you deposit into your bank account is going to be used when dealing with your bankruptcy filing. 

When you know what you shouldn't do when filing for bankruptcy, you can be sure that the process goes a bit smoother. Once you are ready to file, it's important to get started on the bankruptcy papers right away with the help of a bankruptcy lawyer who can help you understand all the language that is used on the paperwork. This can help ensure that you do not make any mistakes that can be used against you during this process, as well.