Filing for bankruptcy may be a scary process for you. It is understandable that all the legal formalities and meetings may be intimidating. Because you may feel somewhat nervous about the bankruptcy process, you may make some mistakes.
While you may not be perfect, it is crucial to be as accurate and careful as possible through every step of the process. Below are some damaging mistakes you should avoid when filing bankruptcy.
1. Forgetting to list all your creditors
Drowning in debt is an overwhelming experience. Amidst the chaos, you may forget some of your creditors. Make sure you list every single creditor, even if it is an old debt or a family member to whom you owe money. If you fail to disclose a creditor, the debt from it may not go away.
2. Hiding assets
It may be tempting to omit a significant bank account or transfer cash to a relative before filing, but those types of tactics are illegal. Make sure you are forthright about all your property and sources of income. If you hide income from a side business, leave out property or put an incorrect value for a piece of property, you may be guilty of bankruptcy fraud. This may come with fines and imprisonment.
3. Spending a lot
When you are about to file for bankruptcy, you may want to go on a spending spree with your credit card. However, if you make large purchases on your credit card right before filing, you may not be able to discharge that debt. It is generally a good idea to stop using a credit card as soon as you are unable to make payments.
4. Not getting proper legal help
If you try to handle your bankruptcy proceedings by yourself, you may make errors on your forms or during hearings. It is helpful to have an attorney with sufficient experience handling bankruptcy cases. The best way to avoid making any costly missteps is hiring a lawyer for assistance.