Bankruptcy mistakes are avoidable. People often make dumb bankruptcy mistakes because they had bad information. There are some Common Bankruptcy Mistakes that can wreck your case before you ever get to court. These bankruptcy mistakes are based on Urban Myths that just don’t seem to die. People are going to keep on making dumb bankruptcy mistakes. But you don’t have to be one of them! Today I will examine—
COMMON BANKRUPTCY MISTAKES
If you have debts that you want to keep, then don’t list them in your bankruptcy case.
Wrong! Wrong! Wrong!
This Urban Myth Bankruptcy Mistake is fueled by people that think they can keep any credit card(s) they want. They think you just don’t list them on the Bankruptcy Schedules. There is another common myth. People may tell you not to list your car loan and mortgages.
What happens because of bankruptcy mistakes?
Your bankruptcy schedules are WRONG if you don’t list all of your debts. There are penalties for filing inaccurate, incomplete or downright false bankruptcy schedules. And, you may have to come back to court again and again until you get it finally get it done right. The court might even deny you a bankruptcy discharge. Egregious cases might even result in having the matter referred for a criminal investigation. It is a crime to intentionally supply false information in a bankruptcy case.
What gets filed with the Court?
A bankruptcy case filing consists primarily of a set of Bankruptcy Schedules. These are Official Forms that everyone is required to use. The official forms are basically a complex financial statement. They consist of schedules listing all of your debts, all of your assets, and your answers to a set of detailed, snoopy questions about your financial dealings and affairs. These schedules must be signed under oath and you may be subject to punishment under the laws of perjury if you make any intentional omissions or misrepresentations.
What about debts I intend to pay?
Most people that need to file bankruptcy have one or more debts that they still intend to pay—a favorite credit card, a car loan or a home mortgage. In fact, there is an Official Form called a Statement of Intentions that requires you to list the Secured Debts that you still intend to pay. This Form also requires you to specify any other Secured Debts where you intend to surrender the collateral and pay no more.
This Statement of Intentions is only for Secured Debts such as car loans and mortgages on a home. There is also a procedure called Bankruptcy Reaffirmation. It may allow you to officially keep certain debts—and remove them from the list of debts that are Discharged. Reaffirmation generally applies to secured debts. (“I have to have my car to get to work”). However, most judges are not going to let you reaffirm a credit card debt.
Bankruptcy Mistakes are best avoided by working with a bankruptcy specialist.
THE SOLUTION: Do not take bankruptcy advice from anyone but an experienced bankruptcy attorney in your area. Do not make any changes in your financial structure before you have expert, professional legal advice.
Bayer, Wishman & Leotta is a Los Angeles Bankruptcy law firm. We have offices in Downtown Los Angeles, the San Fernando Valley and Long Beach. Each Los Angeles bankruptcy attorney in the firm is a Specialist. Check us out on AllExperts.com. We also have a Los Angeles Bankruptcy Attorneys page on Google+.
You can also read our free bankruptcy book. Go to www.bestbankruptcybook.com