Many people assume that filing for Chapter 7/13 Bankruptcy in Jonesboro GA is like getting bailed out of debt. However, it should be viewed as the last resort. A person should only file when they are faced with debt that is impossible to repay. Below are some mistakes for clients to avoid when filing for bankruptcy.
Using Credit Cards
When a client struggles to meet their financial obligations, it is normal to rely, at least partly, on credit cards. However, it should be noted that certain charges incurred up to 90 days before filing cannot be discharged during the bankruptcy. Therefore, clients should inform their attorney about credit card usage when the case is in the preparation phase.
Filing Ahead of a Large Tax Refund
Clients should not file for bankruptcy when they have a tax refund coming because refunds (except EIC or earned income credit) are just like having money in the bank. If a client files for bankruptcy ahead of a tax refund, the refund may be seized to pay the debt. A lawyer will recommend that the client should wait to file until they get the refund.
Failing to List All Creditors
Another mistake to be avoided during bankruptcy is to not list all creditors. Filers are personally responsible for all debts owed to creditors not listed in the petition. Even if a creditor has agreed to an extended repayment period, they should still be listed when filing.
Passing Assets to Family and Friends
Debtors are not permitted to transfer funds to friends and family before filing for bankruptcy. Any assets transferred before filing can be regarded as preferential treatment, and they may be seized by the court-appointed bankruptcy trustee.
Not Being Upfront With the Attorney
Clients should not withhold information from their attorney when filing for Chapter 7/13 Bankruptcy in Jonesboro GA. Concealment of information relevant to the case is not only unethical, it may be illegal in some instances. Filing for bankruptcy requires a significant amount of paperwork and strict adherence to the law. The attorneys at Chriscarouthers.com can help clients file while staying in compliance with legal regulations.