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What Not to do Before Filing Bankruptcy in Huntsville AL


Jackie Graham

Bankruptcy Attorney

Seven Things You Should Never Do Before Filing A Chapter 7 Bankruptcy in Alabama

If you are planning to file for bankruptcy, there are things you should consider before filing. What you do, or don’t do, prior to filing for bankruptcy in Alabama can affect your bankruptcy process. Here are some things you should avoid before filing for bankruptcy in Alabama.

  • 1) Incur new debt- if you anticipate filing for bankruptcy, do not go out and incur new debt. One exception to this would be if you need reliable transportation at an affordable cost and your credit is still good enough to make the purchase, then you would be in a better situation to finance that purchase prior to filing a chapter 7 bankruptcy. Said purchase would not be affected by the chapter 7 filing.
  • 2) Transfer any property- do not transfer any property or take your name off of the deed or title of any property prior to filing a chapter 7 bankruptcy. The bankruptcy trustee or a creditor is likely object to your discharge on the basis of making a pre-bankruptcy transfer.
  • 3) Pay off a creditor- do not pay any creditors off prior to filing bankruptcy. No matter what your situation is, you will look like your are placing one creditor over another.
  • 4) Put any new property in your name- do not let any one add you to their deed, their bank account or put your name on a vehicle before or during a chapter 7 bankruptcy. You cannot undo the transfer before or during the bankruptcy and you risk losing the property all together.
  • 5) Obtain joint debt- do not go out and get joint debt with any other person prior to filing a chapter 7 bankruptcy. Your chapter 7 bankruptcy filing in almost all instances will affect the other person’s credit.
  • 6) Not filing taxes- You should not fail to file income tax returns for at least two years before filing.
  • 7) File before getting money- Do not file before you are about to receive substantial assets, such as inheritance, tax refund or lawsuit settlement.

Free Consultation

If you or someone you know is considering filing a bankruptcy, it is important to know what you should do prior to filing. If you have questions in Huntsville or Decatur, Alabama, the law firm of Ferguson & Ferguson is here to help. Call today for your free consultation. Call 256-534-3435.