While declaring bankruptcy can be a very viable way to relieve the stress of crushing debt, it can only be declared every 7 years. Great thought must be put into whether it is the right way to deal with the financial situation one is currently facing. This answer is an extremely personal one so will greatly differ from person to person. Before hiring a Chapter 7 Bankruptcy Attorney in Tacoma WA, there are some things one should not do. Here are a few, as told by industry experts.
Stay Away From The IRA
If someone has a retirement account, they resist the urge to drain the funds. This is because retirement accounts are usually protected during bankruptcy procedures. Somebody should never spend their life savings trying to get rid of the debt they have racked as most of the debt they have incurred over the years will be discharged once the bankruptcy has been completed.
Honesty Is The Best Policy
It is critical to always be honest when filling out the paperwork to begin the bankruptcy procedures. This is because if somebody knowingly lies or tries to be inaccurate with the number of assets they possess or the amount of debt they have, they are actually committing fraud. This crime could land them in prison for up to twenty years or face financial penalties of up to $250,000. One other factor is if the paperwork is not complete, the court may reject the application and that person will still be left with the debt they were trying to erase. It is usually best to have a Chapter 7 Bankruptcy Attorney in Tacoma WA help to fill out the paperwork.
Never Acquire New Debt
It is considered a form of fraud to incur new debt on luxury items or to take out cash advances up to 70 to 90 days before a bankruptcy application is submitted. The court and creditors may look upon this as taking out loans with no real intention of paying them back. The court may decide to not release the person from their debt obligations.
It is very important to contact a bankruptcy attorney as soon as someone starts thinking they may have to declare it. To do so without consulting with a professional is akin to walking into a minefield.