You may feel like paying a special debt, and during this time of the year you may even get some extra money to do it. Maybe you shouldn’t. Last week we explained how giving a significant gift before bankruptcy could cause problems during bankruptcy. This also applies to selling something for much less than it is worth. Such a gift or sale might … Read More
You can put a “preferential payment” to work for you if you owe a “priority” debt–back child or spousal support, or recent income taxes.
Make your bankruptcy trustee work for you by retrieving your recent payments to, or garnishments by, creditors–to your benefit.
Prevent your trustee from giving you a big headache if you paid a debt to a friend or relative during the year before filing bankruptcy.
Avoid the frustrating surprise of having one your friendly creditors be challenged by your bankruptcy trustee with a preference action.
Preferences can be dangerous but can also present potential opportunities. So although not all that common, they’re worth knowing about.
Your trustee might be able to require a creditor to pay the trustee money you’d paid the creditor. Sometimes that’s good; sometimes not.
You may have extra motivation and greater ability to repay a personally important debt this time of year. But maybe you shouldn’t.
Here are more features of Chapter 7 worth knowing and taking advantage of.
Doing what you believe is the right thing can backfire, if you pay a special creditor before you file bankruptcy.
Decisions that seem to make sense at the time can end up being against your best interest. Hereâs what to look out for.
Not a good idea. If you do your friendly creditor may have to turn over to the trustee whatever you paid it. So it wonât be so friendly.
If you lost money through garnishment during the 90 days BEFORE filing bankruptcy, that money may be returned to you or a favored creditor.
If you’re careful it’s easy to avoid the rude surprise of hurting the friend, relative or other creditor you paid before filing bankruptcy.
Filing bankruptcy doesn’t just stop creditors’ present and future collection efforts against you. It might recoup money you’ve already lost.
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