5 things you should not do when filing for bankruptcy
If you find that you are filing for bankruptcy, it is not necessarily because you are a poor manager of your finances. Maybe, you are just unlucky to be in the right business at the wrong time or in a certain circumstance at the worst time. The most important thing to know is what not to do when seeking Houston bankruptcy court’s protection. Below are a few pointers to the right direction.
Never tell a lie
Lying to creditors, trustees, court or to your Houston bankruptcy lawyer is in bad taste considering the seriousness of the situation. Being protected from the creditors is a privilege accorded by the court to help you rediscover your ability to honor your creditors’ obligations. If you tell a lie to the creditors, they might counter sue to have the protection lifted and have your property liquidated, if you lie to the trustee you will be committing a crime, if you lie to the court you will probably face contempt charges and a probable jail term and if you lie to your lawyer, you may be denying him crucial information that he may need to use to protect you.
Never transfer assets in anticipation of filing for bankruptcy
This reflects badly on you. It shows bad faith and lack of good morals. In fact, it is counterproductive because the trustee has the legal force to recover the transferred assets. In such circumstances, the property will be liquidated and the proceeds thereof distributed among the creditors. A court may deny you protection under chapter 11 and require that you be protected under chapter 7.
Always let your Houston bankruptcy expert to help you
Filing for bankruptcy on your own is courting disaster. An expert usually knows all the loopholes the creditors and IRS may exploit in a bid to recover their money. Furthermore, you expose yourself to counter suits by the creditors by not covering all the legal angles. It is always smart to get the help of the experts when filing for the bankruptcy.
Review the paperwork before signing it
Any form of paperwork, whether from the trustee, creditors, or your lawyer should be reviewed before signing. Remember that by appending your signature to the paperwork you are saying that you agree to be bound by the provisions therein. Failure to adhere to the provisions thereof is actionable. They say ignorance of law is no defense. Make sure you understand what you are committing yourself to.
Not all Debt is discharged
Bankruptcy discharges you from a lot of debts; however, it does not discharge you from all of them. Some of the debts that cannot be discharged under bankruptcy include student loans, spousal and child support etc. You will still be expected to honor some of these debts whether you are protected or not.
Bankruptcy filing is a long process. You need to be prepared to go through that path and overcome it all. You will spend a lot of time with your lawyer and in court. Make sure you are ready for all of it.
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