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Top Three Ways to Screw Up Your Bankruptcy Before You File It

Unfortunately, many people do absolutely the wrong things in an effort to avoid filing bankruptcy.  What's worse, these things can often hurt them unnecessarily or cause problems for the bankruptcy that they inevitably end up filing.   Some of these dubious Greatest Hits are:

  • Transfer title to property, like a home or a car, to someone else for less than its true value (or nothing).  This move is considered fraudulent, in and out of bankruptcy, and is a very bad idea!  Don't try and hide assets.  You are required to disclose transfers at least two (2) years before your filing, and the bankruptcy trustee may look into transfers as far back as four (4) years.  If this is discovered, the trustee will simply seek to reverse the transfer and sell the property!
  • Pay back debts to relatives in full.  Payments to "insiders" like friends or relatives made up to a year before you file must be disclosed.  If they are significant enough, the trustee may seek to get the money back, which could be very embarrassing.  There are ways to deal with debts to friends and family after bankruptcy, which makes advance payment another bad idea.
  • Raiding a pension or IRA for money to pay bills.  This is not a good idea because you are taking money that would otherwise be unreachable by creditors in or out of bankruptcy and paying them with it!  You are also sacrificing your future in a vain attempt to sole a present problem.

No one wants to file bankruptcy, but there are somethings you can do in an effort to avoid doing so that can create real problems for you!

So What Do I Do?

If you live in southern New Jersey and are considering filing bankruptcy, please feel free to call me at 856-432-4113 or contact me through this site for a free consultation in my Woodbury office to discuss your case.

If you are looking for more information about bankruptcy, then download my free book,Top Questions People Ask About Filing Bankruptcy in New Jersey.

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Steven J. Richardson
Bankruptcy, Collections, Student Loan, DUI and Traffic Court attorney in Woodbury, NJ.