Obviously, no person in Michigan plans on filing for bankruptcy. But sometimes life happens and unforeseen circumstances arise. In many cases, bankruptcy may be the best financial option left. Bankruptcy is often a life-changing experience. To make this experience a more positive one, avoid doing these things before filing.
Lying about assets
When filing for Chapter 7 bankruptcy, applicants must fill out a “means test” where they disclose all income and assets. This helps determine the applicant’s ability to pay off creditors. However, if the applicant purposely excludes assets or income, the case could be dismissed. Never lie about assets. Doing so could get a person banned from filing again.
Racking up credit card debt
Before filing for bankruptcy, it may be tempting to use all available credit beforehand. Never do this. If creditors believe an individual ran up his or her credit card balance before filing, the creditor can challenge the request. The individual could end up owing money even after the bankruptcy is finalized.
Not consulting a lawyer
Always secure legal assistance when filing for bankruptcy. Bankruptcy law is incredibly complex and very difficult for the average person to understand. Those in Michigan who have questions or want to know more about the filing process should contact an attorney who specializes in bankruptcy. An experienced lawyer will know ways to legally protect assets that may be at risk.
