How Can I Maximize My Chances of a Successful Bankruptcy Claim?

A bankruptcy is an opportunity for a family or business to undergo a financial “reboot.” It can bring relief for the kind of crushing financial burdens that create stress and anxiety.

Depending on the type of bankruptcy claim you are filing, you could either have some of your existing debt forgiven or be put on a manageable repayment plan. In either scenario, you have the opportunity for a fresh start to rebuild your finances.

It is essential to recognize that merely accumulating a certain amount of debt does not guarantee bankruptcy approval. It has to be approved by a bankruptcy court after a detailed filing process.

That’s why you’ll benefit from speaking with an experienced Baltimore bankruptcy attorney, such as those you’ll find at Belsky & Horowitz, LLC. We have helped many clients navigate the complexities of filing for bankruptcy approval.

Choose the Right Chapter

Bankruptcies are categorized as chapters. The two most common are Chapter 13 and Chapter 7.

The core difference between the two is reorganization versus liquidation. With a Chapter 7 bankruptcy, you will need to sell assets in order to pay back creditors. Chapter 13 allows you to reorganize your debt, forgive some of that debt, and get on a structured repayment plan.

Which option best depends on your individual situation. This is the first decision that you’ll make with your bankruptcy attorney that will be based on your finances and available assets. No matter which chapter you apply for, you’ll maximize your chances for success by putting the following tips into action:

Gather All Your Financial Documents

Getting organized is vital for the bankruptcy filing process. That organization begins with gathering all your relevant financial documents. Here’s what you need to pull together:

• Tax returns for the past two years
• Proof of income in the form of pay stubs or direct deposit receipts
• Bank statements
• Retirement account statements
• Asset documentation, such as property deeds or vehicle titles
• A list of all debts and creditors

It is also vital that you be completely honest and accurate in the documents you submit and your applications.

File at the Right Time

When you choose to file, it is as important as which type of bankruptcy chapter to file under. If you anticipate receiving money from an impending inheritance or lawsuit settlement, you should wait until after those funds are in place.

Additionally, there may be a change in your income status; you’ll want to wait until that is settled as well. This is another area where your bankruptcy attorney can provide guidance.

Avoid Fraudulent Actions

As you enter the bankruptcy filing process, you and your financial history are going to go under a lot of scrutiny. That’s a good thing because it will help you appreciate the full scope of what you owe and how to get back on track.

You must avoid fraudulent actions. Transferring property to friends or family before you file could be seen as an attempt to hide assets or defraud creditors. When that happens, your assigned trustee will likely attempt to “claw back” those assets to support your repayments. That can delay the entire process.

As you enter the bankruptcy process, you must refrain from adding to your debt by making significant purchases, such as a new car, jewelry, or other luxury items.

This could also be seen as a fraudulent attempt to discharge those new debts.

Complete Required Courses

As part of your bankruptcy approval, you will be legally obligated to complete two courses with a trustee-approved provider. Those courses are for credit counseling and debtor education. You must complete those courses within the stipulated timeframe.

Cooperate with Your Trustee

You will be assigned a court-appointed trustee to oversee your bankruptcy application. You must be fully cooperative throughout the process.

That cooperation means submitting all requested documents, meeting any filing deadlines, and attending your 341 meeting. That will be a meeting of creditors where your trustee will verify your debt and ask you questions under oath about your financial history.

Consult With Your Attorney

Throughout the entire bankruptcy process, you can rely on the legal team from Belsky & Horowitz, LLC, to provide you with guidance and support. The approval process can be anywhere from several months to over a year or more. That is why accuracy and honesty are essential.

Our attorneys have reviewed numerous bankruptcy applications. We know the law and the courts. That puts us in the best position to act as advisors and advocates.

Call to schedule a free consultation to get your bankruptcy questions answered.