Making the decision to declare bankruptcy is not easy, but if you’re dealing with insurmountable debt, it can be the best option you have for regaining financial freedom. Filing bankruptcy is a complex procedure, so you need to plan ahead to set yourself up for success. Here are a few steps you should take before starting the bankruptcy process.  

What to Do Before Filing Bankruptcy 

1. Pay Only the Necessary Bills 

Unless otherwise advised, you will want to stop making payments on any unsecured debts you owe. Since the purpose of bankruptcy is to get rid of these debts or restructure them into a more affordable repayment plan, it doesn’t make sense to keep paying them if you are going to file. Instead, use your money to pay necessary expenses, such as your rent or mortgage, utilities, insurance, and car loan. 

2. Stop All Further Credit Card Use 

Continuing to use your credit cards after deciding to petition for bankruptcy can put your case in jeopardy. Once you file, the bankruptcy trustee will inspect your recent financial transactions for any signs of fraud. If it looks like you ran up credit card bills with no plan to repay them, this can be viewed as fraudulent intent. Under these circumstances, your creditors can argue that your debt shouldn’t be discharged. The safest course of action is to stop charging as soon as you know you will be filing bankruptcy. 

3. Gather Your Paperwork 

To help ensure your case is processed in a timely fashion, begin gathering all of the documents you will be required to provide when filing bankruptcy. These include bank statements, tax returns, pay stubs, insurance records, credit card bills, property titles, and retirement account reports.

4. Hire a Bankruptcy Lawyer 

Although you can petition for bankruptcy on your own, it’s strongly recommended you hire a bankruptcy lawyer. They know the ins and outs of bankruptcy law and will ensure your paperwork doesn’t contain any errors that can cause your case to be delayed or dismissed. They will also help determine which type of filing is most suitable for your financial situation. 

If you think filing bankruptcy may be the solution to your debt problems, contact the law office of Brian Kawamoto in Aiea, HI. For more than 25 years, he has used his legal expertise to help residents across the island of Oahu get their finances back on track. He has experience handling both Chapter 7 and Chapter 13 cases and will provide the guidance you need to smoothly navigate the complicated bankruptcy process. Call (808) 486-6107 to schedule a consultation, or visit his website for more information on how he can assist with debt relief.