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Top Ten Things to Consider When Deciding to File for Bankruptcy
When people realize their financial situation is changing and taking a dramatic downturn, they need time to explore their options. It is essential for them to contact an experienced attorney who can help them assess whether bankruptcy may be the best legal option for their situation.
At the law office of Tod J. Beavers, P.C., located in Des Moines, Iowa, we are here to help people plan for bankruptcy by helping them analyze their finances and make key decisions regarding their economic future. For more information about filing for bankruptcy, please contact us today to schedule a free initial consultation with our experienced bankruptcy lawyer.
There are ten pre-bankruptcy planning tips that we will help you consider and execute when deciding whether bankruptcy is a viable option for you:
1. Timing of filing for bankruptcy: Since the Bankruptcy Recovery Act of 2005 was passed, if you are unemployed or experiencing a reduction in pay, there may be a window of opportunity where one type of filing is better than another because of how the means test is now used. Tod J. Beavers has extensive tax experience and can help you correctly calculate your income to see if you qualify for bankruptcy relief using the means test.
2. Use of credit cards: People may need to stop using credit cards and taking cash advances when thinking of filing, because issues of fraudulent activity may come into play. It is important to discuss this issue with an attorney in order to avoid fraudulent activity accusations.
3. Divorce and bankruptcy: If considering filing for divorce and bankruptcy at the same time, it is crucial to talk to an attorney in advance of taking legal action on either issue to ensure you do not block yourself for the legal remedies available.
4. Organizing your finances: It is critical to know where you stand financially in order to make an informed decision about bankruptcy, which includes providing your most recent pay stubs from the past six months, so when you meet with our lawyer so we can properly assess your financial situation.
5. Bill payment: If you have a limited amount of money you should meet with our attorney to structure a hierarchy regarding which bills you need to prioritize. This strategy is important when deciding to keep current on secured debts, such as home and car payments, and which bills and other debts may be set aside.
6. Legal problems: If you are being threatened with garnishment, or a judgment is being assessed for non-payment, you should not wait for these actions to take place. This will not only put you further behind on obligations; it may not be dischargeable later. Speak to us before these legal actions take place, not after.
7. Protecting certain assets: There are assets you may not want to 'spend down' prior to the possibility of filing for bankruptcy, such as retirement accounts and 401(k)s. Certain assets are exempt from bankruptcy liquidation.
8. Understanding non-dischargeable debts: Certain debts may not be exempt, including most student loans and child support obligations. We will help you go through the process of the re-evaluation of your debts to determine which debts are dischargeable and which are non-dischargeable.
9. Good faith: If you continue to stay current on your home and car payments, this can help you protect these assets as well as show a good-faith attempt to not be delinquent when presenting your case at a bankruptcy hearing.
10. Debts to family: It is a good idea to discuss obligations to family members with an attorney before you repay them. We can help you plan for this within the confines of the bankruptcy process.
All of these issues require careful consideration when you are contemplating filing for bankruptcy. To learn more about how we can help you with all these steps, contact our office today to schedule a free initial consultation. We look forward to hearing from you.
Law Office of Tod J. Beavers, P.C.
*Disclaimer: We are a debt-relief agency. We can help you file for Chapter 7 and Chapter 13 relief under the Bankruptcy Code.