Taking the Right Steps to Get a Fresh Start
When life throws you a curve…you lose your job or suffer an injury or illness…the stress and anxiety that come with struggling to meet your financial obligations can be exhausting, just making things worse. When you see little hope for a turnaround in the near future, your best option may be a personal bankruptcy filing. If you’ve made that decision, you want to take the right steps to ensure that you get the full protections of the law. Here are some recommendations.
Hire an Attorney Sooner, Rather than Later
The stigma that often accompanies a bankruptcy filing can cause you to drag your feet. Don’t do that! The sooner you hire an experienced and proven bankruptcy lawyer, the sooner you can start moving forward with your life. Your attorney will immediately become your intermediary with creditors, and can file your petition in a timely manner, so that you start to get the protections afforded by the bankruptcy laws.
Limit Your Spending to Essential Items
When you file a bankruptcy petition, the court can go back and look at how you spent your money in the days, weeks and months (usually up to 90 days) immediately preceding the filing. You may be prevented from discharging debts if the court determines that you intentionally ran up debts that you knew you would seek to eliminate in bankruptcy. You may also be at risk for allegations of bankruptcy fraud.
Don’t use any credit cards or enter into any other debt-based obligations. Spend any income you have on necessities, such as food, shelter and transportation. If you have anything left over, make payments on secured debt, such as mortgage or car loans. If you qualify for Chapter 7, you’ll be able to discharge unsecured debt, so there’s little to be gained by using the limited resources you have to pay those obligations.
Don’t Make Large or Irregular Payments to Family or Friends
These payments may be construed by the court as preferential payments—the court can look at any payments made to friends and family in the last twelve months. If the payment is ruled to be preferential, the person to whom it was made will have to return it.
Contact Attorney Howard N. Sobel
At the office of Howard N. Sobel, we provide personal bankruptcy counsel to men and women throughout the state of New Jersey. Contact our office online or call us at 856-424-6400 to set up a free initial consultation. Evening and weekend appointments can be arranged upon request. We accept all major credit cards.
Named a New Jersey SuperLawyer Every Year since 2008, Including 2022