Get It Right The First Time: How To Avoid An Abusive Ruling On Your Chapter 7 Filing
Debt can feel like a sequoia tree hanging around your neck. Rather than enjoying a fun and fancy-tree lifestyle, you have to carry that burden of debt around with you wherever you go. Fortunately, laws exist to help you shed your past financial mistakes. Filing for a chapter seven bankruptcy is one way to shed your debts, but receiving a favorable ruling is far from a sure thing. A court may decide that you are abusing the intent of a chapter seven filing and rule against you. To avoid the wasted time, anguish, and financial hardships that could follow an unfavorable ruling, you need to make sure that you take all the steps necessary to avoid misrepresenting your plight.
Don't Play Pick-and-Choose with Your Debt
Some people who file for bankruptcy try to shed some, but not all, of their debts. They try to use their bankruptcy to get rid of debts that they don't want while holding onto possessions that they do want. For example, you should not finance a new luxury car or take out a loan to remodel your entertainment room just before you file for bankruptcy. Such a transaction does not fit the narrative of someone who is experiencing financial hardships even though they are doing their level best to make ends meet.
Timing Is Everything
Debt that is unbearable at a certain income might be more manageable after a pay raise. Because chapter seven is for people who see no foreseeable relief to their debt burdens, anyone who knows they will be receiving a pay raise and still files for chapter seven is not showing a good faith effort to pay their debts and keep their head above water.
Playing a Shell Game with Your Assets
Some people try to transfer ownership for their property and money holdings before going into a bankruptcy. The idea here is to protect these assets so that they can't be liquidated to pay your debts. Such a move creates a narrative of someone who is trying to game the system by trying to hide their money to make things look worse than they are.
Basically, if you want to file for chapter seven, you should make sure that you are deserving of it. Using chapter seven to get rid of some debt that you don't want while holding onto everything that you do want is a recipe for financial disaster. Make sure the moves you make fit the narrative of someone who is in serious need of some financial relief. For more information about the filing process, contact a company such as Licata Bankruptcy.