Consequences Of Delaying Bankruptcy

October 25, 2011 by  Filed under: Bankruptcy 

It’s unfortunate, but many debtors who should file bankruptcy wait until the absolute last minute to do so. Maybe it’s a vehicle repossession, foreclosure or even a credit card lawsuit that forces them to seek the aid of an experienced bankruptcy attorney, but whatever it is, it’s usually an emergency. And while filing a necessary bankruptcy late is better than never filing one, waiting until the last minute has many consequences. Let’s take a look at a few of the consequences of delaying bankruptcy:

Lost Assets

When a debtor waits until the last minute to file a necessary bankruptcy, they run the risk of losing important assets such as their home or vehicle. If a bankruptcy is filed after a home has gone through the foreclosure process, the debtor won’t have the power to get it back. The same rule applies to a vehicle. While it is possible to get a lender to return a vehicle after repossession, it’s not possible if the lender has already auctioned off the car. Debtors who know that they are facing foreclosure or vehicle repossession should immediately speak with a bankruptcy attorney to find out their options.

Lost Wages

Wage garnishments are a big risk when you have a judgment against you. Once a creditor files and wins a lawsuit, the next logical step is to get a wage garnishment order. Once the creditor has a wage garnishment order, they can simply take a percentage of a debtor’s paycheck before it ever hits their bank account. Even if a debtor files bankruptcy after a wage garnishment order has been issued, they creditor may not receive the bankruptcy notice before they seize part of the debtor’s income. This is why debtors facing lawsuits should seriously consider their bankruptcy options before a judgment and wage garnishment is in place.

Shoddy Bankruptcy Representation

Having an experienced and skilled bankruptcy attorney is important. Unfortunately, when a debtor waits until the last minute to file bankruptcy, they may not have access to the best bankruptcy attorney available. If a debtor is facing foreclosure, repossession or wage garnishment, they probably don’t have time to weigh the value of each bankruptcy attorney, they meet. Most likely they just choose the first one they meet, even if it’s not a good match. While this sometimes works out, other times it can cost the debtor if the attorney lacks the experience and skill necessary to protect their assets and income from creditors. Even worse, if the bankruptcy attorney fails to include certain assets, income or even fails to include the proper paperwork, the debtor’s bankruptcy case could face dismissal.

Reed Allmand, sponsoring attorney for Bankruptcy.net, is constantly looking for ways to provide the best financial information for his clients. Whether you are considering filing for bankruptcy, or are currently going through a Chapter 7 or Chapter 13, visit http://www.bankruptcy.net for up to date news and information you need to know.

Article Source:
http://EzineArticles.com/?expert=Reed_Allmand

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