4 Things to Avoid When Filing for Bankruptcy

When you're in a rough place financially, you might feel extremely overwhelmed. Filing for bankruptcy may give you some relief. However, in your desire to hurry and get the bankruptcy processed, there are some mistakes you might make which can cause problems. Here are some things to avoid when you file for Chapter 7 bankruptcy.

Not Listing All Your Creditors

You may think it is fine to leave out creditors when filing for bankruptcy since it could take a long time to include every single company and person that you owe money to. However, if a company or a person is not listed, you will still be responsible for paying them back, as they won't be included in the official bankruptcy discharge statement.

To make sure you're not forgetting any creditors, be sure to get a copy of your credit report from the major reporting bureaus. Go through the reports for any companies you may have forgotten.

Not Reporting All Your Assets

To keep from looking better off than you are, you might not be forthcoming with your lawyer about everything you own. Depending on what state you live in, you may be able to keep a lot of your assets, so hiding them is not a good idea. Not only that, but if you are found to have more assets than you are reporting, you may be charged with a crime.

Repaying Your Relatives and Friends First

Before you file for bankruptcy, you may have some money and decide to pay your family and friends what you owe them. However, this can be a big problem. You may discover that your court-appointed bankruptcy trustee asks for that money back, so that it can be divided up equally among your creditors. If this doesn't happen, they may very well deny your discharge, which means that you are still responsible for paying back all your debts.

Assuming Your Student Loans Will Be Included

You might think that every single one of your debts will be taken care of by your bankruptcy, but the truth is that there are some debts that you still must pay, even if you have a bankruptcy under your belt. Your student loans cannot be discharged, so you need to contact your lender and work out alternate payment arrangements.

Be sure to avoid the mistakes above when you are going through a bankruptcy. Work closely with your bankruptcy lawyer so that everything goes smoothly and all your credits can be discharged. Talk with a representative from a firm like Donald T Tesch, PS for more information.