4 Things to Avoid Doing before You File for Bankruptcy

November 20, 2015

Position your bankruptcy case for success by avoiding these mistakes, a Colorado Springs bankruptcy lawyer explains.

Position your bankruptcy case for success by avoiding these mistakes.

When you are ready to file for bankruptcy, you will have to take certain steps first – like completing the credit counseling requirement – in order for your case to be accepted by the court (and, consequently, obtain the debt relief you are seeking).

If, however, you make any of the following bankruptcy mistakes prior to filing your petition, you could run the risk of having your case thrown out. In some cases, these mistakes could lead to more serious issues – like the possibility of facing criminal charges.

Before Bankruptcy, Do NOT:

  1. Take out loans or accumulate a lot of new debt immediately before you file – In fact, if you take out a loan or run up charges that exceed $600 within 90 days prior to submitting your bankruptcy petition to the court, creditors could allege that you have committed fraud (arguing that you racked up the debt with no intention of repaying it because you knew were going to file for bankruptcy). If this happens, creditors can petition the court, requesting that you do not receive discharge for those debts.
  2. Provide false information on your bankruptcy paperwork – This can include intentional omissions, as well as misinformation, about items like your debts, your income, your assets, etc. Failing to be 100 percent truthful on bankruptcy paperwork can constitute perjury, causing you more problems moving forward. It can also result in the court dismissing your case and barring the discharge of certain debts at any point in the future.
  3. Fail to file your income tax returns – Even if you can’t pay your income taxes, you need to file them with the IRS. If you don’t have income taxes to submit with your bankruptcy paperwork, again, your case could be dismissed or delayed (until you do file your taxes), as there may be no other way to determine what your income was for the year(s) you didn’t file taxes. And these delays may provide creditors with just enough time to move forward with wage garnishments, lawsuits, repossessions, etc.
  4. Tuck away some of your assets – This is a common and dangerous mistake people make, as they believe that they can pull one over on the courts and that hiding their assets will allow them to keep these possessions later. If hidden assets come to light in a bankruptcy case, there can be big problems for the bankruptcy petitioner, with just some of the potential consequences being a dismissal of the bankruptcy case and/or federal fraud charges being filed.

Contact a Colorado Springs Bankruptcy Lawyer at the Law Office of Jon B. Clarke, P.C.

When you are ready for experienced help filing a bankruptcy petition, it’s time to contact a trusted Colorado Springs bankruptcy lawyer at the Law Office of Jon B. Clarke, P.C.

To find out more about your best debt relief options, as well as how we can help you obtain the financial fresh start you need and deserve, contact us today by calling (303) 779-0600 or by emailing us using the contact form on this page. We also encourage you to complete our Business or Consumer Debtor Analysis Form so that we can provide you with professional advice that is as specific and helpful as possible.

From our offices based in Denver and Greenwood Village, we provide people throughout Colorado with the highest quality debt relief legal services.

Categories: Bankruptcy, Bankruptcy Mistakes, Bankruptcy Planning