About Me

Understanding Bankruptcy Cases and Outcomes

Hello, my name is Quianna Ridalgo. I enjoy talking to others about bankruptcy case outcomes. Court officials handle each type of debt, from credit cards to home loans, differently. Debtors must carefully prepare themselves for the court proceedings to cope with the outcome appropriately. The way creditors handle the discharged debt also interests me. Bankruptcy attorneys assist their clients with each step of the bankruptcy process from filing paperwork to meeting with creditors. Debtors and creditors both receive counsel that helps them move forward appropriately at every point in the case. The information I share on my site may help you learn about everyone's role in these complex cases. Feel free to come by anytime to learn more information about this interesting subject.

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Understanding Bankruptcy Cases and Outcomes

Bankruptcy Filing Precautions

by Loretta Harris

Bankruptcy is a major undertaking, and care should be used as you approach your filing. The actions you take in the months preceding and directly following a chapter 7 filing can influence the outcome of your case in a dramatic fashion. Read on for some precautionary measures to take that can mean a smoother and more positive bankruptcy process.

About the Idea of Fraud

Most people who file for bankruptcy have no intention of committing a fraudulent act, but it happens nevertheless. As with many things, lack of knowledge is not a legitimate excuse when it comes to bankruptcy rules and laws. A little bit of awareness about how bankruptcy relates to your financial situation can come in handy and perhaps make it more likely that you will consult with your bankruptcy attorney before you make a move that is viewed as fraudulent by the courts. The main point to keep in mind about potentially fraudulent issues is that your entire financial situation is the purview of the bankruptcy courts beginning several months before you even file. In the vast majority of situations, consumers get into trouble when one of the below situations are allowed to happen:

  • Transference of property prior to filing bankruptcy
  • Use of credit cards prior to a filing
  • Not disclosing income from alternative income sources

Transference of Property – A chapter 7 bankruptcy allows the trustee to seize all non-exempt property and sell it. The money then goes to your creditors with the trustee receiving a commission. That means that you have a limited ability to give away, sell, hide, or transfer assets in the time period before you file. For instance, if you take cash from your checking account and put it under your mattress, that is considered concealment and is not allowed. Bankruptcy trustees have the right to uncover and take back any assets if needed.

Credit Card Use – It may be tempting to use your credit cards with abandon when you anticipate an upcoming filing, but that is a bad idea. If you need to use the cards to purchase food, clothing, housing, transportation, and so on, you might be forgiven. Just be sure you don't buy luxury and frivolous items, or you may face challenges from your creditors.

Income Disclosures – Consumer bankruptcy filings face an income test for filing. If you make more than the median income of your state, you may have more work to do before you can file. This may cause some filers to misstate or leave out income when filling out the bankruptcy paperwork. Lottery and gambling winnings, prizes, eBay sales, side jobs, and other uncommon forms of income should be disclosed when filing.

To find out more about any of the above potentially fraudulent issues, speak to your bankruptcy attorney.