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Get Ready to File for Bankruptcy in the Months Prior to Filing

A binder that reads bankruptcy

Making sure you’re prepared for the process of filing for bankruptcy can greatly increase the chances that your Chapter 7 or Chapter 13 bankruptcy petition will be accepted by the court. There are certain ways that you can improve your chances of success; read on to learn what you can do in support of your bankruptcy petition even before your file.

Collect statements with balances and addresses

If you’ve become overwhelmed with unpaid bills and statements on past-due accounts received in the mail each month, you may be tempted to simply throw them all away in order to avoid thinking about the fact that you’re unable to pay those bills. Overcome this urge and hang on to these statements and bills. They will be useful in compiling a complete list of all open accounts which will need to be provided along with your bankruptcy petition, and the statements will provide you and your attorney with a good address at which to contact your creditors about your bankruptcy filing.

Let your creditors know about your upcoming bankruptcy filing

Perhaps it seems logical to hide your imminent bankruptcy filing from your creditors, since these institutions stand to collect only a portion of what they’re owed after you file for bankruptcy. Letting them know you plan to file for bankruptcy, however, could buy you some time before they begin to garnish your wages or file a legal action against you.

Don’t pay back family members just yet

Prior to approving a bankruptcy petition, a trustee will look carefully at your recent financial transactions, and will look in particular for so-called “preferential transfers,” which involves a petitioner essentially hiding money from distribution by the bankruptcy court by having a family member or loved one hold on to the money for a time. If you’ve been struggling to make ends meet for some time, and have borrowed money from a family member, hold off on paying that family member back if you plan to file for bankruptcy within the next year, to avoid making the court think you had conducted a preferential transfer rather than just giving money back to a family member.

Don’t charge up credit cards thinking that debt will go away

If you’re planning to file for bankruptcy under Chapter 7, it may seem logical that you could do as much spending on new credit cards as you wanted in the weeks and months before filing, since you won’t be obligated to pay the entire amount of the debt. This is something that bankruptcy trustees are on watch for, however, and they could accuse you of fraud or bad faith for charging up a great deal of non-secured debt in the weeks immediately preceding a bankruptcy. 

If you are in need of assistance in filing for bankruptcy in Maryland, contact the Germantown bankruptcy law firm Haeger Law LLC for a consultation, at 888-463-3520.