Once you have decided to file for bankruptcy, you may be anxious to get the process started so that you can begin to regain your financial freedom. However, the timing of your bankruptcy petition can have a dramatic impact on the outcome of your case, and in some cases, it may be preferable to wait. Below are some key factors to consider when deciding whether to delay your bankruptcy filing or seek immediate debt relief.

What Are the Benefits of Immediate Action?

For many petitioners, filing for bankruptcy as soon as they know they will be unable to meet their financial obligations is the best course of action. In addition to alleviating the stress of unmanageable debt, immediate bankruptcy filing allows you to avoid wasting precious financial resources. Prompt action may also be necessary if you are facing a lawsuit, wage garnishment, or other aggressive collection action.

When Should You Wait to File?

There are some circumstances in which delaying your petition may put you in a stronger position. For instance, if you are expecting an inheritance, tax return, or large bonus, waiting until you’ve received and used the funds will keep them from being seized by the bankruptcy estate.

Borrowers planning to file for chapter 7 bankruptcy will have to pass a means test to demonstrate their inability to pay back their debts. The test is based on your income in the six months previous to filing, so if your financial situation has recently changed, it may be beneficial to wait.

Finally, you may decide to wait if you have recently transferred property or made a large purchase. If you file for bankruptcy, the trustee can reverse any payments or property transfers, including property you sold in an attempt to pay off your debts. Waiting until the statutory review period has expired will help you avoid complications related to your financial history.

If you are facing impossible financial circumstances, William C. Rieth will provide the debt relief solutions and detailed legal advice you need. This law firm has over 25 years of experience helping clients throughout Rochester, NY, rediscover the path to solvency. Visit their website to learn how they can help you file for bankruptcy, and call (585) 232-6520 to schedule your initial consultation.