FORMER CHAPTER 13 TRUSTEE STAFF ATTORNEY
BANKRUPTCY PLANNING
When deciding to file for bankruptcy, please beware of the following common pitfalls. Speak to attorney Roger Yehl to take action and avoid these mistakes.
FILING A PETITION WITHOUT AN EXPERIENCED BANKRUPTCY LAWYER
Some individuals file for bankruptcy protection with an attorney who may not be experienced in the Bankruptcy Law. This is a typical mistake for people who may have friends or family who practice law. Using an attorney who does not know the nuances of bankruptcy law can be detrimental as people may file an ill-timed bankruptcy and lose property that may have been protected. As such, an individual should always consult with an experienced bankruptcy attorney. To set up your free consultation, simply complete the free evaluation or call 716-573-4980.
DO NOT WAIT TOO LONG TO FILE
Bankruptcy is typically the last option for most people. However, when an individual waits too long to file many complications arise. For example, your creditors may seize your bank accounts, begin wage garnisishments, obtain liens against your property, and foreclose on your house, among other things. Contact Roger Yehl at the onset of your financial problems to discuss your options. This will allow you to avoid the potential problems associated with troubled finances.
DO NOT USE YOUR HARD EARNED RETIREMENT MONEY TO PAY CREDITORS
In most states, your retirement accounts are protected from creditors in Bankruptcy. Using these monies will cause a major set back to your ability to retire. This is a common mistake that has terrible consequences. By using your retirement money, you are not only losing that money but the money's ability to grow. Interest on 1 dollar generates much less than interest on 100 dollars.
ACCUMLATING LARGE DEBTS JUST BEFORE FILING BANKRUPTCY
Many people will incur debts on their credit cards on the eve of bankruptcy believing the debts will be discharged. The debts may still be discharged, however, your creditors have the right to challenge your use of their money just prior to filing. Further, if the debts were incurred within 90 days, you will have to overcome a presumption that you did not intend to repay the debt.
PAYING OFF LOANS TO FAMILY OR FRIENDS
It is quite common for individuals to want to pay back family or friends before they payoff their other obligations. Any amounts to paid to family or friends within a year of filing bankruptcy can be undone by the Bankruptcy Trustee. The Trustee has the ability to sue whomever you paid during the preceding year for the money you paid back.
TRANSFERRING ASSETS THAT MAY NOT BE PROTECTED
Another common pitfall is to transfer assets you own that are not protected under the bankruptcy code. The transfer can be avoided (undone) by the Trustee as a fraudulent conveyance. It is a fraudulent conveyance even if your intentions were pure.
TAKING A SECURED LOAN OR MORTGAGE AGAINST YOUR ASSETS
Taking out a second mortgage or pledging assets as security to payoff or pay down unsecured debt is another common mistake. In the event, you fall behind in the payments on the new loan, you could lose your home or asset pledged. This would not have happened had you defaulted in your payments to unsecured creditors. Further, it is not likely you would be able to discharge the secured loan incurred in a bankruptcy, whereas you would have been able to discharge the unsecured debt paid off by the secured loan.
Get started by completing the free evaluation or calling Roger Yehl at 716-573-4980.