Please Don’t Do This!
A List of Thirty-Three DON’TS in Preparing to File a Chapter 7 Bankruptcy
Clients come to me with all kinds of assumptions about the consequences of disclosing the info they’re concealing. More often than not, these assumptions are wrong. Doing any of the things on list usually comes from fear of what happens when you file bankruptcy; that fear comes from a lack of understanding that I am going to try very hard to correct as we go through this process. I think you’ll be pleasantly surprised by the results! Basically, the only kind of assets I can’t protect for you are the ones you don’t tell me about. The trustee’s motto is “List it or lose it!”
If you can adhere to these suggestions, your Dallas bankruptcy case will go much more smoothly:
- Don’t leave out any accounts, including checking accounts, savings accounts, brokerage accounts or credit union accounts.
- Don’t file a Chapter 7 bankruptcy if your income exceeds your list of expenses.
- Don’t use your credit cards in the time leading up to when your bankruptcy case will be filed. Don’t take out any cash advances on your credit cards in the time leading up to when your case will be filed.
- Don’t use any of those credit card “convenience checks” either. Anytime you charge something or take a cash advance on your card, you are representing to the credit card company that you plan to pay them back at some point. If you’ve already decided to file bankruptcy though, that representation is no longer true. That false representation can lead to them accusing you of fraud. That whole mess is easily avoided by just staying off the plastic.
- Don’t do any balance transfers from one account to another.
- Don’t pay any money to friends as way of keeping it out of your bankruptcy case.
- Don’t pay any money to family, either. It doesn’t help your Dallas bankruptcy case and could actually hurt it.
- Don’t tell any of your pushy creditors that you intend on paying them.
- Don’t leave any of your assets off of your bankruptcy papers. Tell us about all of your spouse’s assets also. Your bankruptcy lawyer can protect most assets you tell us about but undisclosed assets can be lost.
- Don’t file if you are about to receive a tax return or a large inheritance. Be sure to discuss these matters with us so we can time your filing accordingly.
- Don’t fail to discuss with us your small business, sole proprietorship, partnership, LLC, LLP, LC, corporation or hobby.
- Don’t purchase a home shortly before filing bankruptcy without consulting your attorney beforehand.
- Don’t give away or transfer any property to anyone, even if you call it a “gift.”
- Don’t exceed a payment of $600 on any past due bills.
- Don’t cash out any retirement plans or 401k’s. That money is exempt from your Dallas bankruptcy, so leave it where it is.
- Don’t take out a second mortgage on your home.
- Don’t gamble. The Dallas bankruptcy judges may have a problem with that. Be sure you talk to us about that part before we file your bankruptcy case.
- Don’t hide ANY assets or debts. Most won’t be part of your case anyway, so hiding them only messes up the case. The answer is different in other states but in a Dallas bankruptcy, you don’t have to hide anything.
- Don’t take out any “payday loans.” Many of these loan companies have you sign a form to withdraw money from your checking account automatically, and these are almost impossible to stop.
- Don’t transfer your money into your kids’ bank accounts as a way to hide it from your bankruptcy lawyer or the bankruptcy judge.
- Don’t omit, “save” or leave out a credit card for after your bankruptcy case is over. My Dallas bankruptcy clients get bombarded by credit card offers after their case is over, so there’s really no point in saving one now.
- Don’t fail to list any and all debts to family or other “insiders” and don’t take out any new debts where you have someone co-sign on it. When you get your discharge, the cosigner or “guarantor” will still be on the hook for the entire debt. If they’re already on there then it is what it is. But don’t get a family member to be a co-signor on any additional debts, or they’ll get screwed.
- Don’t knowingly write bad checks. Accidents happen, but if they can prove you knew it was bad ahead of time then for the district attorney in Dallas, bankruptcy is not a deterrent to pursuing you anyway. I can probably get rid of the bad checks you already have, but don’t go writing any more of them.
- Don’t borrow any additional money.
- Don’t forget to tell your Dallas bankruptcy attorney about any liens you may have on your home, or unpaid judgments, so they can be erased.
- Don’t make major financial decisions without first consulting your Dallas bankruptcy attorney. Little ones are not important but big ones are– some can help your case and others will really hurt it.
- Don’t get married before you file if your spouse has a high-level income. Even if the marriage does not take place in Dallas, bankruptcy eligibility can be impacted. There’s usually a solution; talk to me about this ahead of time.
- Don’t misrepresent any facts to your Dallas bankruptcy attorney. I can’t help you work around the issues if you’ve hidden them from me.
- Don’t run up your credit cards right before you file bankruptcy.
- Don’t fail to appear at trials or other proceedings in any litigation you already have going on; be sure to discuss and coordinate these court dates with your attorney. I can get most of those transferred to the Dallas bankruptcy court, but not until your bankruptcy case is already on file.
- Don’t hide from your attorney. Keep me up to date with your mailing address, phone number and e-mail address.
- Don’t bank where you also owe money. Close the account and open a new elsewhere. There are hundreds of banks around Dallas, just pick one. Retired people who do this might have a lag time of a few months because it sometimes takes that long for the Social Security Administration to get the new routing process done. If you are pressed to file immediately, empty out the account as soon as the deposit hits the bank. This also happens with payday loans.
- Don’t destroy your important papers. The Dallas bankruptcy court needs to see certain documents as part of your bankruptcy case and if you’ve destroyed them, all kinds of red flags go up down at the Dallas bankruptcy trustee’s office.
Bankruptcy has been around since the Roman times. Any strategy you can imagine to keep your property out of the hands of your creditors has already been thought of by somebody before you, and it’s probably illegal. Play it straight, and I can wipe out the debts and get you a fresh start.
When you’re ready to get out from under the crushing debt load and begin a new debt-free life, contact Dallas bankruptcy lawyer Rustin Polk by clicking here. Tell our Appointments Coordinator, Kimberly, that you are a website reader and she will set you up with a free, no obligation appointment to learn how we can help you.