Filing for Bankruptcy? Here’s What to Do Before the Procedure

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Are you immersed in debt and having to deal with uncooperative creditors? It’s time to assess your situation and deal with the stressful scenario. Bankruptcy is a viable solution for people and business owners who cannot pay up their debts. However, the process can be overwhelming, and hiring an attorney will go a long way. Still, there are various things to do before filing for bankruptcy.

Is bankruptcy the best option?

All financial situations are unique, and there’s no exact response to this question. Nevertheless, it’s critical to examine your situation and think of the pros and cons before making the big move. While you can handle some of the steps by yourself, visit https://baylegal.com/practice-areas/bankruptcy/ to learn the benefits of hiring a bankruptcy attorney.

These professionals deal with such cases often and will guide you accordingly. As you consider bankruptcy, ask yourself the following questions;

  • Do I have so many overdue payments?
  • Are my creditors pushing me to pay up?
  • Are my properties at stake?
  • Do I risk losing my assets, car, or house?
  • Am I dealing with wage issues?

If the response to any of the questions is yes, you may need to talk to an attorney about the available options. Depending on your issues, the lawyer may recommend that you file for bankruptcy.

What are the things to do before filing for bankruptcy?

  1. Review your expenses

All bankruptcy petitions involve expense estimates at the time of filing the case. Before scheduling a meeting with a bankruptcy attorney, review your bank statements to get a clear picture of your expenses. This way, you’ll know whether you have any disposable income that can pay up your creditors.

  1. Engage an attorney-Don’t wait!

Even when you’re not ready to file for bankruptcy, you’ll benefit immensely by speaking to an attorney. The professional will share valuable information to help you make informed decisions.

Most people believe that they shouldn’t waste more funds on an attorney, which is a big mistake.

  1. File your tax returns

Depending on your state and where you file for bankruptcy, you’ll need to provide your tax returns for the previous year. You’ll be expected to provide copies of your tax returns as well. Failure to do this, you risk dismissal of your bankruptcy case.

  1. Disclose your actual income& Expenses

People filing for bankruptcy should disclose their income and assets in the petition. According to the bankruptcy code, lack of full disclosure may lead to unfair treatment of all the parties. It’s not the role of the trustee to find your assets, rather your duty to be honest enough. Without full disclosure, you may lose your right to discharge or your debts. You can also face criminal charges and imprisonment.

  1. Stop using your credit cards.

The use of credit cards is a common complication in bankruptcy cases. Using it during the process is enough proof that you never intended to pay the debt. If you aren’t in a position to clear existing debts, why incur more? Don’t continue using your credit card and avoid taking a cash advance in the time for filing for bankruptcy.

In summary

Bankruptcy provides exemptions to safeguard your assets and discharge your debts. But, the process can be tedious, and you need the expertise of a bankruptcy lawyer for guidance. Before hiring an attorney, get details of the charges and have a signed document as proof of engagement.

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Founded in 1994 by the late Pamela Hulse Andrews, Cascade Business News (CBN) became Central Oregon’s premier business publication. CascadeBusNews.com • CBN@CascadeBusNews.com

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