IF you are considering bankruptcy as a last resort to solve your debt problems, it is important for you to have your case evaluated by a professional who can advise you if it is appropriate for your situation. While there are a lot of cases where filing is the only solution, in other cases, there may be non-bankruptcy alternatives.
In other cases, it may not even be necessary or practical. Your objective in filing must be clear and your expectations must be realistic. Are there more advantages than disadvantages or is it the other way around? Will you get a meaningful discharge of debts or will most debts remain when your case is closed? These are some of the questions that must be answered before you file your bankruptcy petition.
If you are filing for Chapter 7, for instance, and you have substantial assets, some of your assets may not be exempt from liquidation by the court trustee. If possible, your bankruptcy attorney must help you organize your financial affairs in such a way as to maximize your exemptions upon filing.
Most people who file for Chapter 7 have little or no assets, of course, and most people get to keep everything that they have. My point is, if you are in doubt, consult a knowledgeable bankruptcy attorney and don’t try to do it yourself. I have seen people who have tried to save money by filing their own bankruptcy case only to find out later that they are actually paying a bigger price by not being able to exempt a particular asset or discharge a certain debt.
A lot of people who have valuable assets also mistakenly believe that they can just simply transfer assets to family members right before filing in order to protect those assets from being taken by the trustee.
This doesn’t work because the Bankruptcy Code allows the trustee certain powers one of which is the power to set aside certain transfers made to family members within 2 years prior to filing (deemed fraudulent under certain conditions). Additionally, the trustee may, on the basis of state fraudulent conveyance laws, go back further back to a much longer period of time (as long as 7 years in some cases) under certain circumstances.
What this means is that you cannot simply sign a quitclaim deed on your real property right before filing think that this is the right way to protect your assets in bankruptcy. If you are having financial difficulties and filing for bankruptcy looks inevitable, what you do before you file may have an adverse impact on your case because you may not be aware of the legal implications of your actions. Again, careful pre-petition planning with your bankruptcy attorney may prevent future problems with your bankruptcy case. Your lawyer should advise you what you can and cannot do legally.
To those who are more interested in Chapter 13 debt consolidation, you must know that Chapter 13 is only appropriate for certain situations and may not accomplish your objective as effectively as filing for Chapter 7 would. Every case is different and requires careful analysis of not only your present but probably your future goals as well.
Will your Chapter 13 case restrict you from doing certain things like selling your home, business or acquiring a new loan perhaps? Or will it allow you more freedom to do with your property or business as you please once you have gotten back on your feet? What debts will be repaid or discharged after you have completed your payments over 3-5 years? Can your Chapter 13 eventually wipe out debts that are not dischargeable in a Chapter 7 case?
A lawyer who advises you to file for bankruptcy without completely evaluating your situation to see whether bankruptcy is even appropriate for you may be doing you a disservice. What I find even more interesting is that some people simply listen to bankruptcy advice given by their friends, co-workers, neighbors, dentist or hairdresser instead of seeking professional help. Don’t risk being misinformed. Seek the help of a competent bankruptcy attorney.
Since 1997, I have helped thousands of clients get out of debt in order to live more financially secure lives. Let me help you determine if bankruptcy is right for your situation or if other options are available in order for you to avoid it. Call Toll-Free 1-866-477-7772 to schedule a free office consultation. We have offices in Glendale, Cerritos and Valencia.
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None of the information herein is intended to give legal advice for any specific situation. Atty. Ray Bulaon has successfully helped thousands of clients in getting out of debt. For a free attorney evaluation of your situation, please call Ray Bulaon Law Offices at TOLL FREE 1 (866) 477-7772.