Once you’ve made the decision to file for bankruptcy, it can feel like a huge weight off of your shoulders. The debt that has defined your life for years will finally be behind you if you can make it through this process. Even as you work through bankruptcy, though, there are mistakes that can set you back or limit your progress. Use these tips to protect yourself as you get closer to a full discharge of your debt.
Still looking for the right attorney to help you through the bankruptcy process? It’s time to talk to Padgett & Robertson. Call us at 800-303-1416 to set up a consultation now.
Set Up a New Account
Whether you are filing for chapter 7 bankruptcy or chapter 13 bankruptcy, you may want to set up an entirely new checking account at a bank where you do not have any debt. Although creditors are barred from seeking payment from you during the automatic stay, automatic withdrawals may still occur. Additionally, if you owe money to your current bank, they may be able to take money from your accounts to cover your debts. It’s best to have a completely new account that isn’t tied to anything you have anywhere else.
Avoid Accruing Any New Debt
Most people realize the gravity of declaring bankruptcy and do not rack up new debt in the days, weeks, or months prior to filing. Others see the pre-bankruptcy time as one last fling. They spend up their credit cards knowing that they will soon file for bankruptcy. This is considered fraud and can either delay your bankruptcy or lead to it being denied completely. Do not accumulate any more debt once you’ve made the decision to file.
Check Your Autopays
Even if your creditors legally can’t reach out to you to secure payment, that doesn’t mean that your automatic payments will be turned off. That’s likely your responsibility. You should already have a thorough account list because of the paperwork needed for bankruptcy, so set aside some time to log into each account on your list and make sure that you have automatic payments turned off. Extra payments can complicate and draw out the bankruptcy process.
Dig Deep and Look at Your Approach to Money
If you do not ensure that your approach to money is healthy before you file for bankruptcy, you run the risk of ending up in the same situation in seven to ten years. For some, bankruptcy was a completely unavoidable outcome, the result of tens or hundreds of thousands of dollars of medical debt for care that could not be put off.
For most, though, bankruptcy is also the result of poor financial choices, unsustainable spending habits, and a preference for automatic gratification. Consider reading some books on financial health, financial well-being, and money mindset. This will help you make your fresh start a true second chance.
Come Up with a Reasonable Budget
Before your discharge is granted, make sure you know how you’ll spend your money going forward. A thorough budget will include all of your income, all of your set expenses, and all of your variable expenses. If you don’t have exact numbers for your income, estimate on the low side.
When estimating expenses, estimate on the high side. This makes it less likely that you’ll end up with an unsustainable budget that requires you to use credit to get through each month.
Work With an Attorney
If you’ve been attempting to file for bankruptcy on your own, that is one option available to you. However, you may find it significantly less stressful and time-consuming to turn to a reliable and experienced bankruptcy attorney. They know how to navigate the deadlines, documentation, and obstacles associated with bankruptcy. You don’t want to put months of time and work into bankruptcy, only to find out at the final hearing that you missed something important.
Choose the Team at Padgett & Robertson
When you work with Padgett & Robertson, you can feel confident that we have your best interests in mind. Just follow our guidance, get your finances in order as you prepare for your final meeting, and prepare for a new start. Call us at 800-303-1416 or to schedule your free consultation right away.