When facing challenging financial issues, it is tempting to do everything it takes to alleviate the stress. But if you are trying to discharge your debts through bankruptcy, it is crucial to determine whether or not you are ready to file for bankruptcy. It’s also important to talk to an expert to know your options.
Never rush into bankruptcy
Generally, bankruptcy works well to wipe out your debts. But you are limited in how frequently you can do that. For instance, you can only get a Chapter 7 discharge once every 8 years. If you get a Chapter 13 bankruptcy, you can get a Chapter 7 bankruptcy at a minimum of six years later.
During this period, there’s a good chance some people will still find themselves battling deep debt. For example, if you have been battling with illness and got into deep debt to take care of your medical bills, you may want to hold off until your health condition stabilizes. Eviction, loss of employment, car repossession, and foreclosure are some of the problems that can cause financial challenges.
If you intend to file for bankruptcy, it’s best to consult with Florida’s largest bankruptcy provider to know what’s best for you.
Don’t wait for too long to file for bankruptcy
Sometimes, it is in your best interest to file for bankruptcy immediately. For example, if you have a wage garnishment in place, it’s best to file for bankruptcy as soon as possible. This way, you will end up saving more money for your utility bills.
Filing for bankruptcy quickly is a perfect idea when your creditors are filing a lawsuit against you. Your bankruptcy lawyer will analyze the complaint just to be sure whether there are fraud allegations. This is because if the matter goes to judgment, your debts might not be wiped in bankruptcy if you’re accused of fraud.
Keep in mind that bankruptcy law provides limited protection against liens. That means you must file your bankruptcy before your creditors get a judgment and liens linked to your assets. Remember, these issues are very complex, and it would be best if you sought the counsel of an experienced attorney.
Avoid racking up new debts
If the amount of new debt increased substantially during the 70 days to 90 days before you filed for bankruptcy, your creditors are likely to object to your discharge. They can argue that you acquired the loan fraudulently (with no intention of repaying it). Therefore, if you plan to file for bankruptcy and want to obtain credit, ensure the money is intended for the basic necessities of life, including clothing, food, and utilities.
Other things that you shouldn’t do if you intend to file for bankruptcy include repaying debts selectively, moving your assets, failing to file your income tax returns, draining your retirement account, and providing incorrect information. You also shouldn’t file for bankruptcy when you’re about to get a substantial amount of assets.