The Most Common Self-Filing Bankruptcy Mistakes

Oftentimes, filing bankruptcy is considered similar to the act of jumping out of a sinking ship, but there are far worse things you can do IN the act rather than just doing the act in question. As a matter of fact, there are certain things that you will most certainly want to avoid when you are filling out your bankruptcy forms, so let’s take a look at a few great examples.

Honesty is the Best Policy

On any form, particularly a government form, honest is ALWAYS going to be the best policy no matter how you look at it. There are a few ways that you might lie which may look like a good idea initially, but can really come back to bite you later on:

• Leaving Out an Income Source – Whether it is a part time job or an independent contract, it counts, and the bankruptcy court will want to know about it. This goes for all income in your household, and if you leave any of it out, there is a strong chance that your case will simply be dismissed and you will be back in the same financial distress you started in.
• Omitting Car Loans: You need to list any car loans you happen to have as a liability. Also remember that if you own a car outright, you must list it as an asset. You might be afraid of losing your vehicle, but keep in mind that it is illegal to hide this information and no, that does not mean you should transfer ownership of your vehicle right before you file bankruptcy. In most cases, your lender will work with you to ensure that you can keep the car after filing bankruptcy.
• Leaving out Creditors: No, you cannot hide from your creditors and you cannot leave them off of your bankruptcy filing. Remember, credit card companies have centralized information and finding information on the loans you have taken out or defaulted on is just a few keystrokes away. Don’t try to hide anything.

On the subject of transferring items and assets out of your name before bankruptcy, you should note that it IS illegal, and your claim will be denied. In addition to that you must list any and all lawsuits that you are involved in, and you should avoid running up any major credit card balances before you file bankruptcy.

Filing bankruptcy does not have to be difficult by any stretch of the imagination, though there are people who make it very difficult by not following these very simple rules. Start researching the bankruptcy process and make sure that you are ready to address your problems head on. Being prepared is a huge part of making sure that you are able to survive bankruptcy, and if you follow the right steps, then it won’t be long before you are finally, once and for all, back on your own two feet financially. It’s just a matter of time and effort.