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What is the Right Timing for Filing My Bankruptcy Petition?

Bankruptcy filings in the U.S. have been dropping despite the coronavirus pandemic. There is an expectation that bankruptcy filings will increase substantially in the near future, however.

But how do you know if you are on your way to bankruptcy? Look at these warning signs:

  • Lack of emergency fund
  • Using credit cards
  • Not using a budget
  • Owing student loans
  • Loss of control overspending
  • Owning a house you can’t afford
  • Owning a car you can’t afford

When to File for Bankruptcy

If bankruptcy is in your future, you may be wondering when to file. If you think there’s a possibility of going into debt trouble or you’re not going to pay something, it’s best to consult with an experienced Oregon bankruptcy attorney before making any move. However, this doesn’t mean you should rush to file for bankruptcy because your situation could improve or get much worse.

Sometimes it is beneficial to file right away, while other times, it’s best to delay filing your petition. Sometimes waiting can allow you to keep more money, increase your chances of qualifying for Chapter 7, or protect money of another person, e.g., a family member.

Should I File Before or After Foreclosure?

If you are facing impending an foreclosure sale, it’s best to file immediately. You can file for Chapter 13 bankruptcy before losing your home to foreclosure. Filing after a foreclosure will not help provide financial relief. By filing a Chapter 13 bankruptcy, you may be able to save your home.

Should I File Now After Moving to a New State?

Once you move to a new state, you may want to delay filing your bankruptcy petition. The main reason behind this is because filing will largely depend on your old and new states’ exemptions. If you just moved to Oregon, talk to a Eugene bankruptcy attorney to learn your legal options.

What If I Recently Paid One Creditor?

If you pay more than $600 in total to a single creditor within 90 days prior to filing bankruptcy, that payment would be concluded to be a preferential debt payment. It means that you are preferring this particular creditor over the rest. If this specific creditor is an “insider” like a family member, then transfers scrutiny would be extended to one year.

If you made payments within these periods, your bankruptcy trustee would likely pursue to recover the preferential payment you made. This may be an uncomfortable place for you if the creditor is a close friend or relative. In such situations, it’s best to wait and file bankruptcy after a year has passed from the date you made the payment to avoid a trustee from demanding the money or with an experienced bankruptcy attorney, undue the transaction and disclose, disclose, disclose on your bankruptcy schedules. Depending on the situation, by undoing the transaction, this negates the preferential payment.

What About a Recent Money or Property Transfer?

If you transferred money or property out of your name within four years, you might have difficulties with your bankruptcy filing. Such transfers might not be viewed well even if you had good intentions at the time. In law, it is called a fraudulent transfer. Sometimes even an innocent gift to your sister may be regarded as fraudulent.

Speak with a skilled bankruptcy lawyer in Eugene, OR to discuss any such transfers and how these transfers may affect your bankruptcy. Sometimes, given certain facts, filing a chapter 13 bankruptcy may prove beneficial if such a transfer occurred. Or perhaps the transfer does not rise to the value amount that a chapter 7 trustee would want to pursue.

Don’t Wait to Talk to a Bankruptcy Attorney

Most people are often told to settle their financial problems on their own, or perhaps with a credit counselor’s help, with bankruptcy as a last option. However, the people who seek expert bankruptcy advice from the outset are the ones who come out of bankruptcy in the best shape. Besides, the first meeting with a knowledgeable bankruptcy attorney is typically free.

Professional Legal Advice on Timing

Most people in debt problems often have trouble thinking through different scenarios. That’s why having a bankruptcy lawyer who is both sober-minded and skilled makes a lot of sense.

At the proper timing, bankruptcy can help sort out your financial woes. Get started by talking to a lawyer for advice. Book a free case evaluation and speak to bankruptcy attorney Tom Butcher.

Tom Butcher, Attorney At Law

Tom Butcher is the owner and attorney at Butcher Law Office, LLC. He represents clients in financial distress in Chapter 7 Bankruptcy and Chapter 13 Bankruptcy. Tom offers a friendly, respectful, and compassionate experience for clients who are in financial and legal distress. Rather than taking a mechanical approach to filing bankruptcy for clients, like other bankruptcy firms, Tom strives to offer a personal, one-on-one experience, where the client’s situation is of utmost importance. Tom believes this personal attention keeps him connected to the community, and serves his clients best during their bankruptcy.
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