5 Pitfalls that Can Sink Your Bankruptcy Filing

Filing for bankruptcy in Mesa can help you get out from under the weight of your debt and to get a fresh start. You might be able to discharge your unsecured debts and be free of them completely, or you might be able to negotiate a payment plan that helps you better manage your debts and pay it off faster.

But there are certain steps you need to follow when you file for bankruptcy and procedures you must follow. If you make a mistake, it can not only jeopardize your chances of getting a bankruptcy discharge, but it can also result in charges against you. Here are five common pitfalls that can sink your bankruptcy filing in Mesa:

Continuing to Use Your Credit Cards

Some people start to think about filing for bankruptcy, and they decide to run up their credit cards with extraneous purchases because they figure that the amount will be discharged with the bankruptcy decree. Unfortunately, what they don’t know is that the bankruptcy judge will look at the pattern of spending leading up to the AZ bankruptcy filing, and if there seems to be a spike in spending, the judge may consider that fraud.

Once you know that you intend to file for bankruptcy, you should stop using your credit cards and you should not take out any new lines of credit. Essentially, you should freeze your spending except for the essentials.

Failing to Disclose All Credits and Assets

Maybe you want to keep your one credit card that is still in good standing open. You figure that it will be harder to get credit after you file for bankruptcy, so you want to save yourself the hassle and ensure that you have credit when you need it by hanging onto that one card. So you don’t list the account in your bankruptcy filing.

This is a huge mistake. The courts will find out about that account, and when they do, your bankruptcy filing will be derailed and you could be charged with fraud. Always disclose every account, every creditor, and every asset that you have. Even if you think you’ve been careful, the information will be discovered, and the consequences will be much worse than any benefits you were trying to preserve.

Failing to File a Tax Return

You will not be able to continue with your bankruptcy case in Mesa if you have an unfiled tax return. The court will discover the missing return, and your proceedings will come to a halt. To save yourself time and legal fees, you should be sure to file any necessary tax returns before you file for bankruptcy. You’ll save yourself a lot of aggravation later, and you won’t spend more than you have to in legal fees. You’ll also increase the chances of success with your bankruptcy filing.

Failing to Get the Required Counseling

When you file for bankruptcy, you are now required to attend credit counseling and to complete a course in financial management. The aim is to improve your financial literacy so that you can make better choices after your bankruptcy is discharged. Hopefully, you will not find yourself in trouble with debt again in the future.
Do not think you can skip the counseling or the course and no one will notice. They are required parts of the bankruptcy process, and if you do not complete them, you will not receive a discharge. Finish these requirements as early in the process as you can so that you don’t hold up your case.

Failing to Hire an Attorney

Many people try to save money by filing for bankruptcy on their own. After all, they are struggling financially, so they may not think that coming up with the money for an attorney is even an option. But failing to hire an attorney is a huge risk that can actually lead to bigger problems later – and bigger expenses.

You can pick up a packet of bankruptcy papers to file, and you may think that all you need to do is fill them out and submit them. Easy, right? The reality is that these are complex forms, and it is very easy to make a mistake on them. Any mistakes can derail your case or even leave you in legal hot water. An attorney will help you fill out these forms accurately, and can defend you if any adversary actions are filed because complicated issues arise. These are things you would not be able to handle on your own.

Always work with a qualified bankruptcy attorney to avoid these bankruptcy pitfalls and give your bankruptcy filing a better shot of success. You’ll be able to get the bankruptcy protection you need so that you can move forward and start over after being crushed by debt.

Mesa Bankruptcy Lawyers can help with your Chapter 7 or Chapter 13 bankruptcy filing. Our attorneys will review your case and let you know which bankruptcy filing would be better for you, and they will help you understand your legal rights and obligations. They can advise you on the best debt-relief plan to save the maximum amount of assets and have the maximum amount of debt discharged. Call us today to discuss your bankruptcy options.

Mesa Bankruptcy Attorneys

1731 West Baseline Rd.,
Suite #101
Mesa, AZ 85202
Office: (480) 448-9800