Top advice from Owosso, MI bankruptcy expert before filing your petition
December 16, 2021
Deciding to file for bankruptcy is hardly ever an easy choice. But with a bit of planning, you’ll find that the case will go more smoothly and can even be a positive experience. It certainly helps to know what to expect, as well as what mistakes to avoid before going down that road.
In this post, James L. Gutting, Attorney-at-Law and bankruptcy expert in Owosso, MI shares five important things you should know before filing your petition.
1. Re-check all your credit reports
Before filing for bankruptcy, take the time to go through your full credit reports. You’re attempting to wipe your slate clean, so now’s the time to double-check your credit information with all the bureaus and make sure everything is in order.
You’ll also want to ensure that your creditors are listed correctly and address any errors now so there are no issues after filing.
2. Complete your mandatory counseling on time
People wishing to file for bankruptcy are required to complete state-mandated credit counseling courses. Usually, you will have several weeks or even months to meet this requirement and obtain your certificate of completion.
Many people make the mistake of waiting until the last minute to complete the course. If for some reason you’re not able to complete it on time, your bankruptcy petition will be dismissed by the court and you may have to start the process all over again.
3. Disclose all relevant financial information with your lawyer
It may be embarrassing to open up about your financial struggles, but if there’s one person you need to be 100% honest with, it’s your bankruptcy attorney. There’s no advantage to be gained from withholding information about your assets and income.
In any bankruptcy case, a designated trustee will have access to your financial records, so they will eventually notice if there are any discrepancies. Don’t try to hide information about your creditors either. Credit-card companies have centralized information databases and they’ll know when you file for bankruptcy protection.
Trying to deceive the court by withholding or misappropriating relevant information will get your case dismissed. It could also get you banned from filing a petition on those debts ever again.
4. Resist the urge to transfer assets
It might seem like a good idea — transfer ownership of an asset to a family member or friend in a bid to protect the asset. It’s not. For one, it’s just plain dishonest, and if the deception comes to light, you not only risk losing the asset but also having your case thrown out.
If you really want to protect certain assets during bankruptcy, there are laws and strategies in place to help you do that. Your attorney can walk you through the process so it doesn't impact your case.
5. Don't rack up new debt
It’s incredibly irresponsible to take on new debt when you’re in the process of asking the court to discharge the old ones. The only exception is if the new debt is intended to cover necessities like food and utilities.
Taking on debt to fund luxury purchases before filing for bankruptcy will likely backfire. Once the creditor receives notice of your petition, they can challenge the request to discharge the debt on the basis that you committed presumptive fraud — you knew your debts were about to be erased or reduced, so you intentionally took on more debt so it can be included in the amount to be discharged.
Even if the bankruptcy case is allowed to commence, you might end up having to repay the new debt after the case is over.
Filing for bankruptcy? Book an appointment with a bankruptcy expert now
If you're considering filing for bankruptcy, it’s important to have an experienced, local attorney with a track record of success at your side to help ensure a smooth process. James L. Gutting, Attorney-at-Law is the law firm to call when you need a bankruptcy expert in Owosso, Shiawassee County, or any of the nearby Michigan communities.
Book your appointment with our team of experienced professionals today and let us help you get through your bankruptcy with as few hassles as possible. Call now at 989-743-1188 or 810-230-1517 to get started. You can also reach us through our contact form and our team will get back to you shortly.