After deciding that bankruptcy is the only way to overcome your crippling debt, you probably felt relieved about settling on a solution. Once you file, there will be no more harassing creditors bothering you, and you will no longer be afraid to answer your phone.
You may feel like celebrating, so raise a glass to your new future, but don’t throw a big party or spend a lot of money. Remember, while your case is pending and even in the days or weeks before filing, you must avoid doing anything to disrupt your bankruptcy.
What else should you avoid before you file?
As mentioned above, you shouldn’t overspend before or after you file your bankruptcy paperwork. Courts frown heavily on these irresponsible behaviors and could dismiss your case, leaving you even worse off.
To protect your case and form good financial habits for the future, you should also avoid:
- Taking on new debt. Examples include opening a new credit card account or seeking a loan
- Repaying only certain debts. Examples include repaying a personal loan or paying off only one credit card
- Transferring your assets. Examples include moving large sums to another person’s account or transferring property titles to someone else
If tempted to ignore your income tax obligations since you are about to file for bankruptcy, you should think twice. In most situations, citizens are still required to pay their income taxes, even if heading into bankruptcy proceedings.
As far as what you should do before filing, an ideal start is learning as much as possible about federal and North Carolina bankruptcy laws.