Don’t Make This Mistake Before Chapter 7 Bankruptcy

As a Chapter 7 Bankruptcy Lawyer in Sacramento, I help many people file for bankruptcy relief. From time to time, I see my clients make a simple mistake in the weeks leading up to a bankruptcy filing that is easy to prevent.

Don’t make any large luxury purchases or take any cash advances in the 90 days before filing for bankruptcy.

Large luxury purchases on credit and cash advances are frowned upon by the bankruptcy courts. A creditor can object to the dischargeability of a debt related to these uses of credit, which could unnecessarily complicate your bankruptcy case.

Let’s say that you took a $1,000 cash advance in the week prior to filing bankruptcy. The worse case is that the court would not discharge this $1,000 debt. You would be responsible for paying back the $1,000 cash advance after your bankruptcy case was over.

Common sense prevails in bankruptcy court. A purchase of a car because your old car died or the purchase of a new washing machine because your old one was leaking water are not going to be a problem. But you should avoid making such purchases on credit just to be safe.

The use of credit immediately before the filing of your case is not a problem as long as you did not have any intent to defraud your creditors. Should you be in a situation where you used credit right before a bankruptcy filing, I can work with you to make sure that your credit would not pose a problem in your bankruptcy case.

Ultimately, the courts recognize that most folks filing for bankruptcy are in a tough spot and are in immediate need of relief. Even if you have recent credit use, I will still fight for your right to a fresh start in Chapter 7 Bankruptcy. Don’t delay any further. Call my office today at (916) 333-2222 for a free consultation.

Attorney Rick Morin