I know a list of 34 things sounds like a lot but it's better to be as comprehensive as possible when discussing the option of filing a Chapter 7 bankruptcy. When I discuss this option with my clients, timing when to file is one of the most important things we go over. I always advise them to contact me at the beginning of financial difficulty rather than wait. Having a plan A or B (maybe even C and D) never hurts. Once we have a plan, then we prepare.
If filing a Chapter 7 bankruptcy is my client's plan A or B, I tell them to be sure NOT to do the following things as they prepare and provide their information to me. You may wonder "why" on some of these items, and if so, just give me a call. I'll be happy to explain.
1. Don't leave out any bank, checking, savings, brokerage, or credit union accounts.
2. Don't use your credit cards.
3. Don't take cash advances from your credit cards.
4. Don't use convenience checks from your credit cards.
5. Don't do balance transfers from one credit card to another.
6. Don't pay back any loans or give money to family members.
7. Don't pay back money or loans to friends.
8. Don't tell a creditor that you intend to pay them.
9. Don't leave off any assets or things you own from your documentation.
10. Don't file if you think you are about to receive an inheritance or settlement from a lawsuit or personal injury case. Discuss the timing of the bankruptcy further with me.
11. Don't forget to tell me about your small business, sole proprietorship, partnership, LLC, LLP, LC, corporation, or money making hobby.
12. Don't forget to report child support or alimony income.
13. Don't buy a home right before filing bankruptcy without speaking to me first.
14. Don't pay cash for vehicles or pay off your vehicle before filing bankruptcy without discussing this with me first.
15. Don't give gifts, money, land or other property to anyone.
16. Don't pay any debts or bills without discussing the payment with me first.
17. Don't transfer, sell, or deed land, houses, or property to anyone or to a business or corporation.
18. Don't take money out of your retirement plan, IRA or 401k's.
19. Don't take out a second mortgage.
20. Don't gamble.
21. Don't hide assets or things that you own.
22. Don't take out any new payday loans.
23. Don't put your money in your children's bank accounts.
24. Don't omit or leave off a credit card because you want to use it after your bankruptcy. The credit card company will cancel the card even if you want to keep it.
25. Don't forget to list debts you owe to family member and friends.
26. Don't write bad checks.
27. Don't borrow money.
28. Don't forget to tell me about liens, judgments and tax claims that may affect your home.
29. Don't make major financial decisions without talking to me first.
30. Don't get married right before filing if your spouse has a high income.
31. Don't run up your credit cards right before filing bankruptcy.
32. Don't ignore or fail to appear at any court hearings, trials or other proceedings; discuss any lawsuits or summons you receive with me.
33. Don't hide from me (your lawyer). Don't forget about letting me know about changes in your address, phone numbers, or e-mail addresses.
34. Don't keep your bank account at the same bank where you owe money. Close the account and open a new account somewhere else. CAUTION: Some banks will freeze your account when you file bankruptcy even if you don't owe them money.
I know that some of these items may seem repetitive, but for a reason. It's important to ensure a smooth and proper Chapter 7 bankruptcy filing process. If filing a Chapter 7 bankruptcy is what you need to do, then we need to make sure you receive all the benefit that this process can provide for you.