What Not To Do Before You File Bankruptcy

Making the decision to file bankruptcy is never easy. Once you have decided to do it, though, you need to give yourself the best chance possible with your case. Unfortunately, there are many mistakes people make that can delay the process, disqualify them, or worse, even have them charged with a criminal offense. Below, our Orlando bankruptcy lawyer explains what these are and how to avoid them.

Keeping Your Bank Account at the Same Institution as a Personal Loan

 Regardless of whether you have filed for bankruptcy, financial institutions have a right of setoff, which means they can withdraw money from your bank account if you fall behind on making payments on a loan. They do not even have to provide you with notice. You should always try to obtain a personal loan from a financial institution that is different from where your bank account is so this does not happen.

Keeping Funds at a Bank Known for Freezing Accounts 

There are certain banks that are known for freezing accounts when a person files bankruptcy. Wells Fargo is perhaps the best known example. If you have a bank account with an institution that is known for freezing the accounts of bankruptcy applicants, close it and move it to another company.

Starting the Process when Your Bank Account is Artificially High

 There are times when your bank account may be artificially high, meaning there is more in there than usual. For example, you may have just recently gotten a bonus at work but you know that there are many automatic deductions to come. You must disclose how much you have in your bank account when you file, so wait until you have paid your monthly bills.

Failing to Disclose an Expected Tax Refund 

You are required to list all of your assets when filing bankruptcy. You must also disclose any money owed to you. A tax refund falls into both of these categories, even if you have not yet received it. If you want to keep the tax refund, you must still disclose it but you may be able to use an exemption to protect it.

Transferring the Titles on Assets

 Selling or giving away assets right before you file bankruptcy is a very big mistake. Even if you do not intend to artificially reduce your assets, transferring the title on your assets may be viewed as bankruptcy fraud by the court. If you are convicted of bankruptcy fraud, you will face very harsh penalties, which may include jail time.

Paying Off Family Loans Before You File 

If your family member has loaned you money and you do not want them to know you filed bankruptcy, you may want to pay off the loan before you file. This too, is a big mistake. Your family member is viewed as a creditor just like any other when you file. If you pay off the loan, it will look like you are giving that person preferential treatment, which the courts frown upon.

Our Bankruptcy Lawyer in Orlando Will Make Sure You Do Not Make Mistakes 

While you can file bankruptcy without legal representation, there are many reasons you should work with an Orlando bankruptcy lawyer when going through the process. At Anderson & Ferrin, P.A., our Orlando bankruptcy lawyer will not allow any mistakes to be made in your case so you can obtain the discharge you need as quickly as possible. Call us now at 407-412-7041 or connect with us online to schedule a free consultation.

Source:

uscourts.gov/services-forms/bankruptcy