All chapter 7 bankruptcy filers will attend a creditor's meeting. This meeting is normally quick and easy for most filers and very few creditors will appear to challenge any aspect of the filing. Some filers who try to file bankruptcy without the help of a lawyer may end up with repercussions after what should be a routine appearance, though. Read on and learn more about what could happen to filers who don't understand the bankruptcy code.
Bankruptcy Rules Can Be Strict
To discourage fraud and serial filing, the bankruptcy code places a number of provisions in the way of filers. While a bankruptcy lawyer understands the codes well, many consumers are unaware of rules and that means they can accidentally violate them. If you have a lawyer handling your case, you won't encounter any surprises at the creditor's meeting or any time afterward. Consumers that try to go it alone, however, can expect to be plagued by some of the below issues – any of which could delay or even dismiss a chapter 7 bankruptcy case.
The word transfer can mean selling, giving away, or trading property. Property can mean anything from a vehicle to a boat to stocks and bonds. You must be transparent with all property transfers and the rules allow the bankruptcy trustee to go back several months before you file. For example, if you were worried about losing your boat due to the prospect of seizure and gave it away to your brother-in-law, that needs to be revealed when you fill out your bankruptcy forms. If you don't, the trustee could "undo" the transaction. Worse yet, however, your case could be dismissed if it's determined that you intentionally tried to deceive the trustee.
Some creditors will examine the use of your credit cards prior to your filing to determine if you purposely ran up debt knowing you were about to file. You are allowed to use your cards up to the filing date if you can show the use was for needs and not wants. In addition, some creditors will examine your cash withdrawals and the information you used when applying for credit. If you fudged your income, for example, the entire debt could be ruled non-dischargeable.
Filers don't have to be caught off-guard during or after the creditor's meeting. A consultation with a chapter 7 bankruptcy attorney could result in good advice that might have you postponing the filing for a few months to allow problematic issues to age away. To find out more, speak to a bankruptcy lawyer.