If a person is contemplating bankruptcy, certain steps may affect their case, even if they don’t plan to file for several months. It’s typically best to consult a Cheap Bankruptcy Lawyer In Tacoma Wa before filing, but even before doing so, filers should avoid the transactions listed below. By doing so, they will ensure a smooth filing and avoid numerous challenges.
Don’t Transfer Property or Money
Many believe that they can protect their assets by transferring them to someone else, but this simply isn’t true. Not only will these assets still be within the court’s reach, transfers could lead to allegations of bankruptcy fraud. Some examples of troublesome transfers include:
* Putting a car title into a spouse’s or child’s name
* Eliminating one’s name from joint bank accounts
* Moving funds into others’ bank accounts
* Deeding real estate to someone else, even if the property’s real value is paid
Some consumers move assets out of their own names for fear of losing them, but that doesn’t always happen. A Cheap Bankruptcy Lawyer In Tacoma Wa will be able to tell a client how to deal with vulnerable assets during the case.
Don’t Make Payments to Creditors
So many people wish to do the right thing by paying creditors off before filing, but these transactions aren’t allowed. While it’s okay to pay bills as normal, filers can’t make payments out of the ordinary. Known as preferential transfers, these payments may lead to claw back lawsuits where the court-appointed trustee sues the creditor to get the funds back.
Stop Using Credit Cards
Unless it’s an essential purchase, debtors should stop using credit cards immediately. It’s safe to use debit cards, however, because they draw directly from a bank account.
Don’t Sue Anyone
Legal claims are assets that may be seized by the bankruptcy court, even if the case hasn’t been resolved and the settlement amount hasn’t been determined. Even claims that haven’t yet been filed are part of the bankruptcy estate. If there’s a pending claim, whether it’s a lawsuit or another type, consult an attorney before filing. Call the office or visit the website to schedule a consultation.
