When you are faced with the difficult decision of filing for bankruptcy protection in Florida, there are many things that you should and should not do. We have put together a list of “DO NOTs” before filing for bankruptcy. We hope that you find this list helpful. If you are considering filing for bankruptcy protection, please give us a call. Even if you have done a DO NOT on the list below, we may still be able to help you.

Here is the list of TOP 20 “DO NOTs” prior to filing your Chapter 7 or Chapter 13 bankruptcy petition:

1. DO NOT pay your relatives or friends in favor of your other creditors and DO NOT try to transfer property out of your name and into theirs. If you do, the bankruptcy trustee may sue them on behalf of your creditors to get the money back.

2. DO NOT take a loan against your real estate in an effort to reduce the equity. You can often file a bankruptcy and not lose this valuable asset. If you take out a second mortgage to pay a credit card debt, you may be putting your home at risk.

3. DO NOT run up your credit card debt prior to filing a bankruptcy. Bankruptcy law is designed to protect the honest debtors – not those who want to have one last final hurrah!

4. DO NOT borrow, withdraw from or cash out your 401K, IRA, or ERISA qualified savings, life insurance and retirement plans to pay bills. In most cases these plans can be protected during the bankruptcy process.

5. DO NOT lie to your attorney or withhold information about any circumstances. Remember, just about everything you tell your attorney is privileged. Many times what a client may feel is immaterial becomes very relevant at some point in the future and a lot of negative consequences can be avoided if they are known in advance of filing bankruptcy.

6. DO NOT file bankruptcy if you are about to receive a tax refund or inheritance. Discuss the timing with your attorney.

7. If your kids are minors, DO NOT transfer money into their bank accounts prior to your filing of bankruptcy. They have you as a co-signer and are subject to the same review as your bank accounts.

8. DO NOT expect your Attorney to help you defraud the Bankruptcy Court and your creditors. It is not going to happen. The bankruptcy code is here to help debtors who need it not debtors who want to take advantage of the system.

9. DO NOT assume that the bankruptcy will get rid of all your debts. Some tax liabilities are non-dischargeable in a bankruptcy (basically, all tax liability accrued in the three tax years prior to filing are non-dischargeable in most circumstances). Student loans are also non-dischargeable in a bankruptcy, except in cases of extreme hardship.

10. DO NOT lie on your bankruptcy petition. You will be signing the bankruptcy petition papers under penalty of perjury, which means if you lie you could face fines, imprisonment and you will not receive a discharge.

11. DO NOT tell your attorney that certain items of personal property do not belong to you if they really do belong to you.

12. DO NOT wait until after filing your bankruptcy petition to purchase a vehicle, if you know you will need a new car, tell your bankruptcy attorney at your initial consultation or prior to filing.

13. DO NOT get married just before filing bankruptcy if your spouse has high income.

14. DO NOT take any cash advances off of credit cards prior to filing for bankruptcy. The court may suspect that you are acting in bad faith and may refuse to discharge the debt in your bankruptcy case.

15. DO NOT pay ahead or pay off balances early on secured loans, such as a car.

16. DO NOT pay ahead or pay off balances early on unsecured loans (personal loans, medical bills, credit cards or store cards, etc.).

17. DO NOT attempt to sell your property for less than what it’s worth. This will not reduce the amount you eventually have to repay – and you or whoever you sold it to may end up stuck with the difference after your bankruptcy is filed.

18. DO NOT transfer any property to a relative within one year of filing your bankruptcy case. The Trustee may even go back five (5) years from filing the bankruptcy case if the transfer was for a fraudulent purpose such as avoiding paying your creditors.

19. DO NOT buy any luxury items prior to filing for bankruptcy. Any luxury items purchased prior to filing for bankruptcy are viewed as non-dischargeable debt in a bankruptcy proceeding.

20. DO NOT misrepresent facts to your attorney; we are working to help you on your bankruptcy matters.

All bankruptcy cases are unique; by no means is this list meant to be exhaustive. Please contact our office to discuss your bankruptcy case or any other questions you may have regarding Florida bankruptcy law. Your initial consultation is free. In West Palm Beach, call (561) 932-0900 or in Stuart, FL call (772) 600-2677.