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What should I not do when filing for bankruptcy?

On Behalf of | Dec 22, 2019 | chapter 7 bankruptcy |

When you consider filing for bankruptcy in Maryland, there are certain things that you may do with your finance that may end up hurting your case. Before filing for bankruptcy, you should consult an excellent attorney who may take you through the process. However, even before you do that, there are some financial mistakes that you should avoid if you want the bankruptcy process to flow smoothly without any challenges. 

According to Alllaw, you should avoid transferring your assets or money to a family member with the hopes that you will get any protection from the bankruptcy court. Worse case is that the transfer may lead to a matter of fraud even if your intentions were not malicious. 

Regardless of how much good you want to do and pay a few creditors before you may file for bankruptcy, you should avoid doing it entirely since such transactions are prohibited. Such payments are called preferential transfers and may lead to the bankruptcy trustee suing the company that you sent the cash to claim the money back. 

You should avoid suing anyone since any legal claim you have may be taken up by the bankruptcy court as an asset regardless of whether you resolve the case or not. Additionally, any claims you may have against anyone that you have not yet taken to court becomes the property of the bankruptcy estate. By avoiding to make the above mistakes, you may prevent some of the problems that you may encounter when filing for Chapter 7 bankruptcy. 

This information is only for educational purposes. Please do not take it as legal advice. 

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