When most people think of filing for bankruptcy, they 破產諮詢 think of what they need to do and have to do. Rarely do they worry about what they shouldn’t do. This is one good reason to consult a bankruptcy attorney when first considering the idea of filing for bankruptcy. The bankruptcy attorney will be able to fill the individual in on some tips they might like to consider before filing.
Prior to filing, most people don’t realize how the bankruptcy estate is created and what is included in it. Because of this many people will take money out of their retirement to cover their living expenses prior to the bankruptcy filing. This is a huge mistake because money that would be protected by bankruptcy exemptions is now part of the state and fair game for the trustee to take it. If it was just left in that 401(k) account it couldn’t be touched.
Another foolish thing individuals do is pay debts preferentially. They might choose credit cards that they want to continue using up until the bankruptcy filing so they choose to pay them while no longer paying any of their other debts. Preferential payment is not okay with the bankruptcy court and that money might be collected by the bankruptcy trustee. Even worse than that, people will pay friends and relatives back so they can leave them out of the bankruptcy filing. What they don’t know is the bankruptcy trustee will look through the bank account of the individual filing and see if there were any payments made in the six months prior to filing. Any money given to the relative or friend can be seized by the bankruptcy court making a very embarrassing situation for the individual.
The bottom line is, if someone is to be successful when filing for bankruptcy is important that they are completely truthful with the bankruptcy court. Now that we are living in a technology driven and age, it has become very easy for the bankruptcy trustee to gather a wealth of information about a person that is filing bankruptcy. Many people make the mistake of bragging on their social media website about plans they are making post bankruptcy. It won’t look good for an individual to post something about an extravagant cruise or an expensive trip to Hawaii after they get their bankruptcy discharge. This will lead to a lot of questions from the bankruptcy trustee. Along those lines, always remember that a former friend or disgruntled employee might also try and enlighten the court on any property that the individual might be trying to hide. That’s why it’s important to let the bankruptcy attorney earn their keep by using the exemption laws provided.
One reason many people in financial trouble try to avoid filing for bankruptcy like the plague is because their lack of knowledge. In the recent years, the US has seen a large number of Americans filing bankruptcy to eliminate debts, stop foreclosure and just get back on their feet. Unemployment now continues to stand at around 8% and it doesn’t look like it is getting much better anytime soon. Many people are kicking the can down the road as they continue to borrow as much money as their creditors will allow them. A large group of the middle class is now borrowing to pay debts that they will never be able to pay back. The average debt to income ratio of the middle class is now 154%. At some point in time, the interest alone will force them into bankruptcy filing. They are doing nothing more than robbing Peter to pay Paul to continue their unsustainable lifestyle. Not only are the citizens of the US playing with fire, the government is running a $1 trillion deficit and is poised to surpass $17 trillion in debt in the next year. Ronald Reagan once compared the government to someone spending money like a drunken sailor, but the only difference was at least the sailor was spending his own money.
For someone that is living this lifestyle and stressed out about making the decision to file bankruptcy, they should combat their fears and stress with facts about how their life will be after filing bankruptcy. Most people can’t see themselves living without plastic and also believe that a bankruptcy filing will take that luxury away from them. Although creditors would like debtors to believe that they will no longer have access to the golden goose if they file bankruptcy, they are opportunists and see employed individuals emerging from bankruptcy being virtually debt-free. Typically, the same creditor might hold a grudge against that individual, but there are thousands that will be willing to take a chance.
Another thing that stresses people out when considering filing for bankruptcy is the possibility of others finding out. Pride is a powerful emotion that will make people do foolish things even not in their best interest. Because of pride many people continue throwing good money into the debt abyss knowing well that the debts will never be paid off. It’s common for a bankruptcy attorney to hear a client speak of how they wished they didn’t throw all that money away and used bankruptcy much sooner. Hindsight is always 2020 and if they had only educated themselves with facts and not rumors they still would have all that money they threw away. First those that are still worried about someone finding out, they really have nothing to worry about unless that person is a creditor of theirs. When filing for bankruptcy is required for an individual to list all their creditors, even family members and friends if applicable. Even though it is public record, unless the individual tells someone, most likely no one will know. In the big scheme of things, it really doesn’t matter what others think when it comes to protecting your family’s financial future.
The endgame is creditors will no longer be able to contact the individual giving the person peace of mind and allow them to once again answer their phone. At the end of the bankruptcy filing, many people exit being virtually debt-free and get a fresh start while trying to avoid making the mistakes of the past.