Posted on: 21 May 2018
For many people going through severe financial hardship, filing for Chapter 7 bankruptcy can be a wise choice. Specifically, this type of bankruptcy allows for those who file (and get approved) to extend their repayment periods on their debts, eliminate some (or all) of their debts, and still keep their assets in the process. Before you decide to begin the process of filing for Chapter 7 yourself, however, there are some common mistakes you should be careful to avoid.
Missing Important Documents
When you file a petition for Chapter 7 bankruptcy, you'll be asked to provide a number of important documents as part of the process. All too often, however, petitions are initially denied because of missing documents and forms. It's easy to overlook a form or miss a document, so make sure you keep a detailed checklist of what you need. And don't wait until the last second to get that documentation, as some documents could take a minute to receive from a bank or other institution.
Omitting Information From Your Petition
As part of the application process, you'll also need to fill out some detailed information about your income and debts on your Chapter 7 petition. It is important to be as accurate and detailed as possible here, including full and current amounts of any debts owed and your annual income. If you misreport any of this information either intentionally or on accident, your application will be denied.
Assuming All of Your Debt Will be Discharged
While a big reason people opt for Chapter 7 over Chapter 13 bankruptcy is the ability to keep assets and have debt discharged, it's important to realize that all of your debts will not automatically "go away" with Chapter 7. There will likely be a lot of negotiations with your creditors, and in some cases, it may not be possible to have all of your debt discharged.
Not Consulting With a Bankruptcy Lawyer
Navigating the process of petitioning for Chapter 7 bankruptcy can be very complex, so having a bankruptcy lawyer on your side is always a good idea. Going it alone increases the chances that you'll make a mistake that will result in your petition being denied, so give yourself the added peace of mind that comes with having an experienced bankruptcy lawyer on your side! This will also help you to avoid some of these common mistakes throughout the process.Share