Filing for bankruptcy is a big step. If you file Chapter 7 you could lose a significant portion of your assets. If you file Chapter 13, you will have to consolidate all of your debts and create a repayment plan. Either way, you will not get through the process unscathed because your credit will suffer for up to 10 years after the bankruptcy. To make sure the bankruptcy process is as painless as possible, you need an experienced legal team on your side. Don’t hesitate to call Davis, Ermis, and Roberts, P.C. We’ve been helping clients discharge their debts for more than 35 years, and we are happy to help you through this challenging time.
Before you file, it’s important to know which things you should do and which actions you should avoid. Here is a summary of the do’s and don’ts:
DO Hire an Attorney.
Most people need an attorney to help them navigate the tricky bankruptcy process. Their expertise will more than make up for their cost. An attorney can keep creditors at bay, stop harassment, make sure all necessary documents are filed, protect you from perjury, and negotiate with your creditors.
DO Take Credit Counseling.
In most cases, you’ll need to complete a credit counseling course before you can file for bankruptcy. This ensures that you’ll be familiar with all the credit consequences of your decision. The course is available over the phone and online and takes about an hour to complete.
DO Gather Financial Documents.
You’ll need to provide proof of income, bank statements for all accounts, two years of tax documents, a credit report, and the case number for any judgements rendered against you. Include as many bills and collection letters as you can.
DO Refer Debtors to Your Attorney.
As soon as you retain a lawyer, send the debtors their way. Once you file, a judge will place a hold on all collection attempts. Your attorney will make sure debtors comply with this hold and will field any calls for you in the meantime.
DO Ask Questions.
The entire process will go more smoothly if you understand what is happening and why. A good attorney will answer all your questions and guide you through your part in the bankruptcy proceedings.
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DON’T Give Away Assets.
All of your assets must be accounted for, including cars, jewelry, electronics, and the money in your bank accounts. It’s illegal to give those things away in order to hide them, and a court will know what you’re up to.
DON’T Get Deeper in Debt.
You might be tempted to run up your credit cards or obtain new ones before your credit takes a hit, but it’s not a good idea. Credit card debt you incur 90 days or less before your filing will likely not be included in the bankruptcy. The same goes for home equity lines of credit and other loans. You will still have to repay this debt.
DON’T Empty Retirement Accounts.
Some people raid their 401k or IRA accounts to pay off creditors before they file for bankruptcy. This isn’t allowed under the bankruptcy code because it favors one creditor over the others. Your retirement accounts are exempt anyway, so they are protected assets. Raiding them will do more harm than good.
Call Davis, Ermis, and Roberts, P.C. Today
Our experienced legal team works hard to take the stress off of our clients during rough times like bankruptcy. Let us deal with the documents, paperwork, and creditors so you can focus on regaining your financial footing and getting on with your life! Call us today for a free consultation.