3 Bankruptcy Mistakes

Many people who file bankruptcy do so after many months of agonizing over the decision. As such, they also have many months where they're struggling to pay their bills. In the months leading up to bankruptcy, some people make unfortunate mistakes. Below are three that you'll definitely want to avoid:

Bankruptcy Mistake #1: Spending Your Retirement

Did you know that most retirement funds are protected from bankruptcy? Many people don't and mistakenly cash out their retirement accounts out of fear of losing it or to pay off debts that could otherwise be discharged or reduced in bankruptcy.

Bankruptcy Mistake #2: Incurring Additional Debt Once the Bankruptcy Decision Has Been Made

This one can be tempting. After deciding to file for bankruptcy, it's tempting to go out to a fancy restaurant, maybe even take a vacation, and charge these expenses to a credit card. Not only is this considered dishonest, it's also considered fraud to take on debt with no intention of paying it back. You could even be charged with a crime.

Bankruptcy Mistake #3: Transferring Property

It's understandable that you might want to transfer property to a loved one or friend in order to protect it. However, by doing so, you are inadvertently voiding some of the protections that your bankruptcy attorney can secure for you. Your bankruptcy attorney can often protect your property; however, once you transfer it, built-in protections no longer apply and the trustee may even repossess the transferred property and sell it to pay off your creditors.

These are but three of many common bankruptcy mistakes. Do yourself a service by consulting with a qualified Brownsville bankruptcy attorney and save yourself the heartbreak of unknowingly making devastating mistakes. Contact us today.