5 Ways To Make Filing For Bankruptcy Go As Smoothly As Possible

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Filing for bankruptcy is often the best way out of a complicated financial tangle, but it's also a complex process that many people find frustrating. The court can also deny a motion for bankruptcy if all of the conditions have not been met. To make it even more complicated, laws that were enacted in 2005 make filing for bankruptcy more difficult than it was in the past. Proper preparation is important in order to make the transition go as smoothly as possible. Here are five ways that you can maximize your chances of smooth sailing through the murky waters of bankruptcy court:

Think Twice About Using a Bankruptcy Petition Preparation Service

Although services are available that are designed to assist consumers with bankruptcy forms, these offer limited options and cannot provide you with even a small amount of legal advice. For instance, if you have questions concerning which type of bankruptcy might be best for your particular situation, the preparation service cannot legally provide you with an answer, and they also cannot represent you in bankruptcy court. These are basically document-generating services that cannot take the place of a qualified lawyer.

Hire a Good Bankruptcy Attorney

A good bankruptcy lawyer can guide you through the process and make certain that you are as prepared as possible when it's time to appear in court. Even filling out a typical petition can be extremely complicated, and one small error can cause your case to be dismissed by the judge. Bankruptcy laws vary by state, and they often change frequently with the enactment of new statutes. An experienced bankruptcy attorney will be up on any recent changes. Click here for more information.

Be Prepared to Attend Financial Counseling Sessions

One of the relatively new laws that affects all 50 U.S. states is the requirement that those filing for personal bankruptcy protection attend financial counseling sessions. Although this may seem like just one more chore in an already stressful situation, this ensures that you are educated about the process of bankruptcy. You will also be required to obtain a bankruptcy education certificate in order to help you avoid future financial pitfalls.

Stop Automatic Payments Before Filing

If you have certain bills and debts that you've set up to be paid automatically from your bank account, you should stop this process prior to filing bankruptcy. Many people erroneously believe that filing for bankruptcy means that these payment will no longer be taken from their accounts, but that is not the case. You should also stop any automatic credit card payments that you have set up before you file your bankruptcy papers.  Stopping payments yourself will provide you with an extra layer of protection, because although creditors are actually supposed to stop collecting automatic payments once they receive notice that you have filed for bankruptcy, but this often doesn't happen.

Prepare for Utility Company Set-Offs

Your utility companies cannot legally demand that you pay past due amounts as a condition of continuing service, but what they can -- and often do -- is to use the funds from any security deposits that you have made to cover past due amounts. This will allow them to legally require you to provide them with a new deposit. If at all possible, you should avoid this situation by timing your bankruptcy filing for when you are not behind on any of your utility bills. Many people do not realize that utility companies can offset deposits in the event of bankruptcy, creating a situation that causes significant financial distress.

Being as prepared as possible for the upcoming court proceedings is the best way to ensure that bankruptcy filing goes smoothly. Working closely with a skilled attorney will eliminate the risk of making costly and frustrating filing mistakes.

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26 December 2014