There’s a lot of discussion about filing for bankruptcy and what to expect once debts have been discharged, but there aren’t as many resources regarding what to do before you file. There’s a small lull between the panic of impossible financial burden and actually filing bankruptcy with the help of an experience bankruptcy lawyer that no one really talk about.
For those who like to be prepared for everything, here’s a quick to do list of what needs to get done before you file:
Request a copy of your credit report. This will be useful when attempting to compile a thorough list of all creditors. You will be responsible for researching accounts in addition to the information provided by the report as they won’t include addresses, but it’s a big help for many consumers preparing to file.
Compile your list of creditors. The list should have names, estimated balance amounts, account numbers and accurate addresses for every creditor you have. It’s extremely important that this list be as thorough and accurate as possible.
Consider any debts carefully to ensure you are aware of potential ramifications. For instance, co-signers will not be protected when you file for Chapter 7, but Chapter 13 will not negatively affect a co-signer. Discuss this further with an experienced bankruptcy lawyer at your first consultation.
File your taxes. You cannot file bankruptcy without first filing your taxes for at least the two years prior to the date of bankruptcy filing. Not filing your taxes will make completing the petition next to impossible and will stop the bankruptcy proceedings in its tracks. Your tax documents are a vital piece of the puzzle. They are crucial in determining earnings and assets, tax obligations that must be considered, etc. A missing tax return will most likely cause your bankruptcy to be dismissed or result in objections to your Chapter 13 plan. If you’re even considering filing for bankruptcy and you haven’t filed your taxes, do it immediately.
Do not rack up new debt. If you incur additional debt in the 70-90 days prior to filing, the creditor who holds that debt can object to discharge by claiming that you had no intent of paying it back. This is what would be called fraud. Generally speaking, cash advances up to $875 within 70 days before filing are not acceptable (unless it was in the form of a payday loan). Using a credit card to purchase a luxury item of $600 or more within 90 days of filing is not acceptable. For additional information regarding the specific nuances of objectionable purchases in the months preceding bankruptcy contact a bankruptcy law professional.
Consider calling one of the bankruptcy experts at Westgate Law today in order to get more information about what you can do to prepare for bankruptcy.