If you’re going to have trouble paying the filing fee the courts will allow you to make a payment plan. Of course, you still have to take the credit counseling classes and meet the other requirements. People will often ask me how they’re supposed to afford it all. There’s a company I’m working with that can front the money, although you would have to pay it off in a year and you do have to have a job to qualify. It’s hard, but it’s an option when people seriously can’t afford it. Usually, people in this situation need to get some help from family or friends or get on a payment plan.
Should I Transfer Money Or Assets Before I File For Bankruptcy?
No, you should not transfer money or assets to family or friends before you file for bankruptcy. It’s considered fraud and the trustees will go looking for anything transferred within the last two years. We do have some strategies for exempting what we can, and we will try to protect as many assets as legally possible. Sometimes people find that they can’t file right away because they have already filed within the past eight years or because they transferred something significant like a house within the past two years.
Can I Charge Up A Lot Of Credit Card Debt Before I File Bankruptcy?
Absolutely not, that would be considered a presumption of abuse situation. They have a look back period of six months. That means the credit card companies can decide you did this all in anticipation of filing, and they can refuse to discharge that debt at the 341 hearing. This is not something you can get away with doing, despite what some people think.
Can I Consolidate Debt Or Explore Other Options Before I File Bankruptcy?
A lot of clients actually do try to consolidate their debt before they even come to talk to me, which actually makes me sad. Debt consolidation can hurt your credit more than a bankruptcy will. In debt consolidation, the creditors don’t get any money until the credit consolidation people have enough money to negotiate with. They’ll hold all of your monthly payments until they have enough to make an offer to your creditors, and every month your credit is getting worse and worse although you may think your problems are solved. When they do succeed in negotiating and having some of your debt erased, the IRS will consider it income and tax you on the debt that was erased. That doesn’t happen in a bankruptcy. I generally advise clients against consolidating debt, because it doesn’t help them in the long run.
Does The Kind Of Debt I Have Determine Whether Or Not I Should File Bankruptcy?
If you have secured debt you probably want to keep the property that was used to secure the debt, such as your car or your house. In that situation, you wouldn’t file for bankruptcy because you want to keep your property. Instead, you would do a reaffirmation agreement. On the other hand, if you have a house but you just can’t make the payments anymore and you don’t want to keep it, you would declare bankruptcy.
When people are thinking of declaring bankruptcy on a debt of less than ten thousand dollars, I usually tell them they should do something else. You can only declare bankruptcy once every eight years, so there’s a threshold you should reach before you even consider it. That would be a situation where I would try and help them to consolidate their debt.
How Much Debt Do I Have To Have Before Filing For Bankruptcy?
I have a threshold of ten thousand dollars, but there are exceptions. For elderly people, it is sometimes best just to ease their stress and anxiety by getting their creditors off their backs.
For more information on Affording A Bankruptcy In California, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (530) 317-5556 today.