When used correctly, bankruptcy can be a powerful and overall beneficial tool to get you out of financial hardship and on with your life. Whether you need to file for Chapter 13, Chapter 7, or some other form, success depends on you and the steps you take to prepare. Since no one ever really tells you what to do to prepare for filing for bankruptcy and there aren’t really courses offered on the subject, our Bedford bankruptcy attorney and the Law Office of Mark B. French have compiled a basic breakdown on what you should know. If you have more questions, feel free to contact us at (817) 381-9855 or fill out an online case evaluation form today.
Preparing for Bankruptcy in Texas
- Automatic stay: One of the worst parts about falling behind on your bills is the creditor harassment that soon follows. One of the best parts about filing for bankruptcy is the creation of an automatic stay. This process prevents all, or nearly all, of your creditors from contacting you or taking money from you while your bankruptcy is being processed.
- Deposit protection: If you owe money to the same bank that holds your checking and savings accounts for you, they may be able to automatically grab as much from your accounts as they can the moment you file for bankruptcy. You can prevent this from happening by transferring your savings to another bank before filing. Always check with a bankruptcy attorney first to ensure you are not risking anything fraudulent by doing so.
- Utility companies: Most utility companies will have first say of your finances when you file for bankruptcy, if you are behind on your payments to them. Sometimes it is wise to use whatever you can to pay off all utilities and then file, as this could ultimately protect more of your money from their hands.
- Automatic payments: In the digital, internet era we live in today, we all use automatic payments on various websites and accounts. Turn those off before you file for bankruptcy or you could be obligated to keep paying those agencies and organizations, even after an automatic stay has been created.
- Future finances: Your life after bankruptcy might not be carefree but it shouldn’t be completely stressful, not if you have filed correctly and successfully. To ensure you do not step back into less-than-ideal spending and saving habits, prepare your future now by taking some time to learn more about budgeting.