If you are considering filing for bankruptcy, there are several things you should not do before filing. There are several things that some people do before filing for bankruptcy that destroy their chances of filing.
Here are a few things that will affect your bankruptcy case.
No Transfer of Property
The first mistake that you want to avoid before filing for bankruptcy is the act of transferring property before filing your case. There is nothing like a secret trick that your potential creditors might now know about.
So, when you make a transfer, the trustee can undo it. It is in your best interest to only transfer property after you file for bankruptcy. This act can make you look shady, and it can actually cause you all sorts of problems before you go to court.
If you want to know more about how to file for bankruptcy, you might want to get in touch with the bankruptcy attorney jackson county mo, and get professional advice on the do’s and don’ts for filing bankruptcy.
So, if you have transferred property, you will want to get it transferred back. Depending on the state where you live, the trustees can go back four years to see what state you are in and any potential property transfers that you might have done. And the trustee might be able to undo the transfers if they think that you have made the transfer to avoid paying your creditors.
You get the point – you will want to ensure that there is absolutely no back and forth of property or anything similar before you file for bankruptcy.
No Charging Up Credit Accounts
Another thing that you should never do before filing for bankruptcy is the act of charging up your credit accounts. Some people know that they will charge for bankruptcy and they make the mistake of charging up their credit cards.
The creditors aren’t stupid because they will call you on it, and they will make you repay those charges that you made right before filing for bankruptcy. Now, if you charged your credit cards for basic living expenses, such as food and gas, then these might get overlooked by your trustees; however, if you charged up the accounts to go on a cruise ship and then filed for bankruptcy, then you will have to bear the consequences.
So, don’t go crazy on your credit cards right before filing for bankruptcy.
No Withdrawing Money from Retirement
Right before filing for bankruptcy, you cannot withdraw money from your retirement account. Here is the thing: if you withdraw money from your retirement account, you will be converting a protected asset into an unprotected asset.
You have to be careful about the protected assets. Though you can take money from your retirement account for a good and valid purpose, you will want to avoid crossing the line because if the withdrawn amount is too much, you won’t have any money left to pay your creditors.
So, it is in your best interest not to touch your retirement account before filing for bankruptcy.