A successful personal bankruptcy petition can be life changing. It can rid you of overwhelming debt and help you secure the fresh financial start you need. This, in turn, can protect your mental health.
But the personal bankruptcy process isn’t always as easy as it seems, which is why you need to be careful as you navigate your case. If you make unwitting mistakes, then you could put yourself at risk of missing out on bankruptcy’s greatest benefits.
Don’t make these mistakes when seeking bankruptcy
Bankruptcy really can be a lifesaver in your time of need. But if you make any of the following mistakes, then you could be denied the relief you seek:
- Running up debt on your credit card shortly before or even after filing, as that may be viewed as acting in bad faith.
- Using your assets to pay back family members and friends rather than creditors who will seek payment through the bankruptcy process.
- Using your retirement assets to pay off debt before seeking bankruptcy protection, since these assets are typically exempt from the bankruptcy process.
- Taking out a second mortgage to pay off credit card debt, which could increase the risk of losing your home.
- Failing to appear for court and otherwise follow the bankruptcy steps required by law.
There are several other mistakes that can be made along the way, so be sure to navigate your case with care.
Take full advantage of the bankruptcy benefits available to you
Don’t be scared away by the complexities of the bankruptcy process. And don’t let someone else give you a false perception of what the process entails. Instead, educate yourself on what you can do to obtain the new lease on life that you deserve. Hopefully then you can rest assured that you’ve done everything you can to protect your future.