Talking About Filing Bankruptcy

About Me

Talking About Filing Bankruptcy

Hi, I’m Vera Poluccio. When I was going through my divorce, I spent way too much on my credit cards to support the lifestyle I was used to. When the reality of my finances set in, I was unable to recover from the credit card payments. As I slipped into a financial hole, I had to research various ways to avoid bankruptcy. Unfortunately, I was unable to avoid this inevitability, so I hired a bankruptcy attorney to walk me through the process. The attorney was able to help me discharge my debts and start off with a clean slate. My site will cover all aspects of the bankruptcy process. Thank you.

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Beware Of Presumptive Bankruptcy Fraud Before You File

The period just before you file bankruptcy is a challenging time for most debtors. It is also a potentially risky time when you may end up accidentally committing bankruptcy fraud. What is bankruptcy fraud? And what might send the court a signal that you've committed it? Here are the answers to some of your questions. 

What Is Presumptive Bankruptcy Fraud?

Any attempt to take unfair advantage of the bankruptcy system is bankruptcy fraud. During the period before filing, certain actions can be presumed to be an attempt to do just that. For instance, perhaps you wrack up a credit card with no intention of paying it back (by intending to declare bankruptcy on it). 

If the bankruptcy court decides you have committed presumptive fraud, it can make all related debts nondischargeable or even terminate your case without any discharge. 

What Will a Judge Look For, and Why?

So, what are some red flags that will catch a judge's attention? 

One key component is how short the period is between the charges or debt and your filing for bankruptcy. The closer these two events are, the more likely it is to be presumed fraudulent. This is especially true if you were paying any other debts preferentially (while taking out new debt as well). 

In addition, the judge may want to know if you were already consulting with a bankruptcy attorney before taking on the debt. This would indicate that you planned to get the debt discharged and that you had professional advice before deciding to take it on. 

Changes in spending habits are considered carefully. Sudden increases in spending, vacations beyond your normal, and multiple charges in a short period of time can also be red flags that you planned to not have to pay the charges. 

Finally, the court will assess your financial situation at the time of the debt in question. Did charges go over your spending limits? Were you employed or unemployed? Were the charges for necessities or luxuries? Living well beyond your legitimate means so close to filing bankruptcy may mean you knew you wouldn't be paying it back. 

Where Should You Start?

To get started, you will want to reach out to a bankruptcy attorney in your state long before you plan to actually file. They will help you avoid these and other presumptively fraudulent moves and prepare to defend any questionable debt you must take on. Make an appointment today.