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What Not to Do Prior to Filing for Bankruptcy

Don't do this Post-it

If you’re considering filing for bankruptcy, it may be because you feel at a loss about how best to handle your financial situation, and you are not sure how to handle the mounting bills that seem impossible to pay. In the months leading up to filing a bankruptcy petition in New York, however, there are certain things you can do that can hurt the chances of your petition’s success. Avoid doing the following, and seek guidance from an experienced New York bankruptcy attorney in order to best promote a brighter financial future.

DON’T continue to spend using credit cards, thinking you won’t need to pay that money back:

Accruing additional debt when you have already decided to file for bankruptcy may be considered fraudulent or in bad faith, and keep you from receiving an approval of your bankruptcy petition.

DON’T throw out important financial documents:

Receiving bill after bill that you can’t pay can feel overwhelming, but resist the urge to throw these documents away. Billing statements will help you in remembering all your debts to be included in your petition, and will provide an address to which you can provide your creditors with notice of your bankruptcy filing.

DON’T pay back money borrowed from family members:

Under the rules of bankruptcy, money paid to a family member in the year prior to filing for bankruptcy can appear as a way of shielding those funds from payment to your creditors through what is known as a “preferential transfer.” You may have an arrangement with a family member whereby you have agreed to pay borrowed money back, just as you would to a financial institution, but a bankruptcy trustee may not see it that way. If you filed for bankruptcy under Chapter 7, the family member may be required to pay that money back. In a Chapter 13 filing, payments made to a family member could result in larger monthly payments for you.

DON’T hold any information back from your attorney:

Hiding debts or money transfers from your lawyer could end up resulting in the rejection of your bankruptcy petition, should these assets and debts eventually become known to the bankruptcy trustee. Let your attorney have the opportunity to advise you on the course of action that’s best for your current and future interests, and for the success of your case.

If you are facing large amounts of medical or credit card debt in New York and need help finding a way out, seek legal assistance from an experienced and compassionate attorney and contact the Hudson Valley bankruptcy attorneys at Rusk, Wadlin, Heppner & Martuscello for a free consultation, in Kingston at 845-331-4100, and in Marlboro at 845-236-4411.

Hudson Valley bankruptcy attorneys Rusk, Wadlin, Heppner & Martuscello describe what not to do before filing for Chapter 7 or Chapter 13 in New York.

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Kingston Office

255 Fair Street, P.O. Box 3356
Kingston, New York 12402

Phone: 845-331-4100
Fax: 845-331-6930

Marlboro Office

1390 Route 9W, P.O. Box 727
Marlboro, NY 12542

Phone: 845-236-4411
Fax: 845-236-3190

Rusk, Wadlin, Heppner & Martuscello, LLP, is located in Kingston, NY and Marlboro, NY and serves clients in and around Ulster County as well as parts of Orange, Dutchess, Columbia and Greene Counties as well as many surrounding areas.

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