There are many questions that might arise when you plan for a bankruptcy. Some questions are more common than others. Here at the Law Offices of Bonnie L. Johnson, we try to offer the most comprehensive list of answers to your most common questions so you can get the debt relief you rightfully deserve. Some of these questions include topics about divorce, the military, income taxes, new appliances, and other such things. If you have any questions that we haven’t answer yet, feel free to call us at 214.748.4848 or e-mail us at Questions@BLJLaw.com.

Should You File for Divorce Before, After, or at The Same Time as Bankruptcy?

In most circumstances, bankruptcy takes priority over divorce. If you were to file for bankruptcy before or after the divorce process, you would have to wait and finish the bankruptcy process before the divorce can be finished. There is no real way you can file for divorce and bankruptcy at the same time due to how bankruptcy handles debts tied to a person. If you are trying to qualify for a Chapter 7 bankruptcy, filing for divorce first could help you pass the means test by lowering your income to below the median income. If you file bankruptcy first, you can possible wipe out joint debt. If you file for divorce after the approval of a Chapter 13 payment plan, you are both responsible for the Chapter 13 payment plan. Either way, after the bankruptcy process is finished, the divorce process will continue without any delays. While divorce is a separate issue from bankruptcy, consider talking to a bankruptcy attorney to help you assess your individual situation to see what is your best course of action.

Can I Stop Paying My Bills If I’m Going To File for Bankruptcy?

There are three things to consider if you plan on not paying your bills and filing bankruptcy: (1) type of debt you owe, (2) how soon will you file, and (3) type of bankruptcy you will file. You should always continue paying alimony and child support if you are required to. Domestic support obligations such as alimony and child support debts will not be eliminated when you file for bankruptcy. You should also continue making payments on services you need such as utilities and rent. If you do not pay for your basic services, these services can be shut off. If you want to keep your house or car after bankruptcy, you should continue making payments on your mortgage or car loan. However, some bills you can opt not to pay are unsecured debts like credit cards, medical bills, and payday loans. Make sure you consult with a professional before you take any drastic action though.

Will Bankruptcy Affect My Ability to Join the Military?

Bankruptcy will not prevent you from joining the military. Your financial history is a possible point of concern. The Department of Defense requires and expects individuals to “pay their just financial obligations in a proper and timely manner.” The military cares about your finances because they want to find out if you are a responsible, trustworthy, and reliable person. The military cannot discriminate because you filed for bankruptcy. Bankruptcy is a right given by the U.S. government for those in need. During the military recruitment process, the military will review your financial background using an application for Financial Eligibility Determination (FED). The military can deny your enlistment if you have been passing bad checks, had foreclosures, live beyond your means, had repossessions, had foreclosures, have gambling debts or even have a high debt-to-income ratio. Bankruptcy can help with your enlistment by showing the military that you have taken the initiative to responsibly handle your financial issues. However, if you still have bad financial habits after your bankruptcy, then the military can deny your enlistment. Use bankruptcy to your advantage and explain to your recruiter why your past financial problems will not affect your service in the military. If you are interested in the military, do not let debt stop you from honorably serving your country. Talk to an experience bankruptcy attorney so we can help you do want you want to do and serve your country.

Should You File Income Taxes Before or After Bankruptcy?

When you should file your income taxes depends on your personal situation. However, you should always file your tax returns. If you have not filed your tax returns, you will be unable to even file for bankruptcy. In a Chapter 7 bankruptcy or Chapter 13 bankruptcy, you should make sure you are up to date with filing your income taxes. Whether or not you can keep your tax refund depends on the amount of your refund, your bankruptcy exemptions, and when your bankruptcy is filed. Your personal situation is unique. Make sure you have a professional assess your case and see what they can do to ensure you get what you deserve.

Should I Buy Household Appliances Before or After Filing for Bankruptcy?

You should NOT make large or expensive purchases before you file for bankruptcy. Buying expensive items can affect your bankruptcy in many ways. Whether or not an item you buy will affect your case depends on the value of the item, method you paid for them, and your bankruptcy exemptions. If you buy an expensive item with credit before filing for bankruptcy, your creditor can make sure that debt is not eliminated by bankruptcy. In Chapter 7 bankruptcy, even if you are able to purchase an expensive item, the bankruptcy trustee can sell your property to pay back your creditors. Fraudulent spending will cause you to never be able to file for bankruptcy ever again. Before filing bankruptcy, talk to your attorney and make sure bankruptcy can help your situation.

Should I Buy a Car Before or After Filing for Bankruptcy?

Again, you should NOT make large or expensive purchases before you file for bankruptcy. If you were to finance a car before you bankruptcy, there could be allegations of fraud brought against you. However some factors that can affect whether or not you are able to buy a car is the condition of your current car, how are you paying for the car, and what type of bankruptcy are you filing. If you buy a car in Chapter 7, the bankruptcy trustee could sell your car to pay off your debts. If your car purchase is reasonable depends on your personal situation. Most of the time after bankruptcy, you can qualify for a car loan after your bankruptcy is finished. Sometimes what you can do before and after bankruptcy is confusing, but talking to qualified bankruptcy lawyers can help solve your problems.

Should I File Bankruptcy Immediately?

Whether or not you should file for bankruptcy depends on your unique circumstance. If you just moved to Texas, you should wait until you can qualify for the bankruptcy exemptions that Texas has. If you had your income reduced or lost your job, you should see if your income is below Texas’s median income. If you paid back a loan to someone, they might be sued by the bankruptcy trustee to pay back your creditors. If you recently charged up your credit card, the bankruptcy trustee could accuse of you of fraudulently spending. If you gave away your property, the bankruptcy trustee could take the property back. Those are some reasons you should not file immediately. If your house is being foreclosed, you should consider filing to protect your house. If your car is being repossessed, you should consider filing to protect your car, If you are being sued by your creditors, file bankruptcy to protect yourself from lawsuits. There is no clear cut answer to when you should file bankruptcy. What applies to one person, might not apply to you. You should come in for a free consultation with a lawyer to discuss when you should file for bankruptcy.

Can I Withdraw Cash Out of My Bank Account Before I File for Bankruptcy?

Do NOT withdraw and spend all the money in your bank account before you file. If you do, the bankruptcy trustee could charge you with bankruptcy fraud. There are penalties for bankruptcy fraud. You can suffer from criminal prosecution or a dismissal of your case. There are exceptions. A knowledgeable bankruptcy attorney will be able to tell you how to protect your money in your personal situation. It is better to do it right the first time than to be penalized for something you did not know.

Should I Withdraw Cash From My Retirement Account Before Filing for Bankruptcy?

Withdrawing money from your retirement account before you file for bankruptcy is never a good idea. Your retirement account is usually protected when you file for bankruptcy. The bankruptcy trustee usually cannot take money from your retirement account to pay your creditors. If you withdraw money from your retirement account earlier, the money you withdraw is not protected by bankruptcy. Also, when you cash out your retirement money, you will have to pay penalties and more taxes on anything you withdraw from your retirement account.

Can I Use My Credit Cards Prior to Filing for Bankruptcy?

Do NOT charge up your credit card. Do NOT purchase expensive items, do NOT get cash advances, and do NOT buy luxury goods. If you do any of the following, the bankruptcy trustee will accuse you of bankruptcy fraud. Bankruptcy fraud can prevent you from ever filing again. Come in and talk to your local bankruptcy lawyer about what you can and cannot do with your credit cards before filing bankruptcy.

The bankruptcy process is a tough process for most people, but at the Law Offices of Bonnie L. Johnson, we try to make bankruptcy easy and understandable for you. Our job is to help guide you to the debt relief you need and deserve. Come in for a FREE consultation about your individual case and see what we can do for you. Give us at call at 214.748.4848 to schedule an appointment with us. Financial freedom is a phone call away.