Bankruptcy may affect your life if you don’t plan beforehand. This is a critical choice that must be thoroughly examined before proceeding. If you’re facing foreclosure or repossession, you should call The Law Offices of Paul Y. Lee right away. Otherwise, these are the things you should think about as you proceed.
Stay away from taking on more debt
For your bankruptcy, you’ll need a strategy. You don’t want to take on more debt, such as cash advances, loans, or credit cards. Why? Because it may appear to be a ruse. Judges will take into account a variety of criteria, including the number of charges, the amount of charges, your occupation, and whether your purchases were luxury or life-saving. They will next assess whether or not the debt may be dismissed. Don’t jeopardize your discharge by taking on new debt.
Never take out a loan on your house
Borrowing against your house for unsecured debt is never a smart idea. You may be able to claim as much as $175,000 in your house as exempt throughout your bankruptcy procedure, depending on your age, marital status, and health.
Of course, all of this assumes that filing for bankruptcy is the best option for you. You may surpass the exemption levels in some cases, such as if your house is paid off and you have a lot of equity in it. In such scenario, non-bankruptcy options such as refinancing your house or debt settlement programs may be preferable. When you contact The Law Offices of Paul Y. Lee, you will receive the experienced guidance you require to discover more about your unique choices.
Keep your retirement plans to yourself
Your retirement plans, such as 401ks and IRAs, may be fully protected from liquidation in a bankruptcy case in California. As a result, it’s advisable not to withdraw any funds from any of your qualified retirement accounts. It’s critical to plan ahead of time for your bankruptcy. For additional information, call The Law Offices of Paul Y. Lee at 951-755-1000 right now.
Do not repay personal loans before declaring bankruptcy
When circumstances are tough, many individuals borrow money from friends, family, and business partners. As things worsen, it’s typical for debtors to desire to pay off their personal loans before filing for bankruptcy since it appears to be the appropriate thing to do.
Unfortunately, if you repay a personal loan within a year of filing for bankruptcy, the court may consider it a preference transfer, and the bankruptcy trustee may sue your relatives and friends to recoup those payments. Furthermore, any payments made to unsecured creditors within three months of filing for bankruptcy may be deemed a preference transfer. Before you go any further, you should talk with the professionals at The Law Offices of Paul Y. Lee.
Bankruptcy should not be made on the spur of the moment. We can give a free evaluation at The Law Offices of Paul Y. Lee, during which we will inform you of your choices and the best course of action.