Obtaining Bankruptcy Protection - Westgate Law

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Obtaining Bankruptcy Protection

When a person needs bankruptcy protection, they often cannot afford to pay their attorney for filing the bankruptcy. In such a case, one could look to their family to assist them in paying these fees so that they can receive the protection they need. There is a possibility that a loan could be procured to pay these fees, but with full intent to pay it back; for instance, many attorneys are willing to set up a payment plan as they move your case forward. Bankruptcy is provided for those who have exhausted all attempts to pay their debts. It is a second chance financially and should definitely not be weighed down by a loan for attorney fees that the filer has no intention of paying back.

Other possibilities to consider if you need to file for bankruptcy and needs funds to do so:

(1) use your 404(k) or retirement account;

(2) talk with friends who may be able to assist;

(3) a part-time temporary job could earn the fees for your bankruptcy attorney.

If you determine that a personal loan is your only way to procure the money for the bankruptcy filing, then you need to be aware that said creditor can challenge your right to eliminate his loan in the bankruptcy and require you to pay it back. Any charges incurred in the 90 days before the filing are what is referred to as nondischargeable.

The court would automatically side with the creditor if that creditor claimed that you had no intention of paying them back for charges or cash advances made within those time periods. Proof that you did intend to pay those amounts back will have to be provided to the court.

Creditors review your account to look for anything out of the ordinary in your spending even outside of the particular provision in the bankruptcy law. They can go back for years. For instance, you have a credit card with a $20,000 balance but haven’t used it much for years, but suddenly you used up the entire balance in a two-month period of time, the creditor will be suspicious. In this type of situation, the creditor is allowed to challenge the debt even if it occurred outside of the 90-day period.

To discuss your own situation in relation to bankruptcy law with southern California bankruptcy attorneys, get in touch with Westgate Law today.

About the Author

Justin Harelik

Justin has a singular goal: to get people out of financial distress and move them to financial stability and prosperity. He does this by combining 15 years of in-depth experience in bankruptcy, credit management, debt negotiation and student loan modifications, and he does it with both English and Spanish-speaking clients.

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