Timing of Your Bankruptcy

When you are having financial difficulties, sometimes the timing of when you file for bankruptcy can be just as important as the type you file.

Delaying Filing

There may be times you might want to delay filing bankruptcy for a few months to make sure your work bonuses or one-time payments are not going to throw your median income level off. Other reasons may be that you just recently lost your job, the last six months of employment will make it appear that you have more monthly income than you actually do. If possible, waiting a few months will change your median income to be more realistic with what you actually have.

Other reasons to delay filing are if you are expecting substantial debt in the immediate future, such as new medical bills, balloon payments, large utility payments, or overdue rent. Waiting for these debts to occur gives you the most benefits from your discharge. If these debts show up after you have filed bankruptcy, they will not be discharged, and you will be responsible for paying them.

Bankruptcy should not be filed until your bills are completely accounted for. If you purchase items knowing you are going to file for bankruptcy and you don’t intend to pay on them, these debts can be declared non-dischargeable in your case, or it could be considered fraud and your bankruptcy can be dismissed, and you will be responsible for that new debt.

Emergency Bankruptcy

You might have to file bankruptcy immediately to avoid utility shut-offs, foreclosures, evictions, or vehicle repossessions. You can prepare and file the papers in as little as a few minutes or a few hours.

Planning for Exemptions

By arranging your assets, you can legally claim the maximum amount of property that can be claimed under the exemption rules. An example would be to turn your cash on hand (which can be seized) into household goods that are exempt from seizure. You cannot, however, sell your nonexempt property far below it’s the value or give away it away. Your court-appointed trustee will evaluate any transfers for the years before filing bankruptcy.

If you need help in deciding when is the best time for you to file bankruptcy contact a Citrus Heights bankruptcy attorney to discuss the best option for your unique financial situation.