Bankruptcy Before or After The Holidays

Should I file for Bankruptcy Before or After The Holidays?

It's that time of year again—the holidays will be here before you know it. Though this time is joyous for many, the financial pressure of buying gifts, hosting holiday meals, and spreading cheer can make the holidays stressful for those struggling to make ends meet. If you are struggling financially and feel bankruptcy is the only option for removing holiday stress, you need to make sure you file at the right moment. Choosing the wrong time to file for bankruptcy can tremendously impact your case in a negative way, including the possibility of dismissal.

Will my Holiday Debt be Discharged if I file After the Holidays?

When you file for bankruptcy, creditors evaluate pre-bankruptcy spending to ensure that you are not trying to take advantage of the bankruptcy process. Unnecessary large purchases made on credit within 90 days of filing, including holiday spending, are often not dischargeable and can cause significant issues for your case. Even after 90 days, large purchases or cash advances made on credit, at a point where a debtor knew or should have known that they did not have the wherewithal to repay the debt, can lead to the creditor filing a complaint to ask the court to make that debt non-dischargeable.

If you file for bankruptcy after making significant holiday purchases, you may give creditors a chance to accuse you of fraud. Being found guilty of fraud can have detrimental effects on your bankruptcy filing, including the complete dismissal of your case. Filing earlier in the year eliminates the possibility of discharge resulting from excessive holiday spending.

How Can I Benefit from Filing for Bankruptcy Before The Holidays?

You have enough to do during the holidays without worrying about creditors calling to collect their debt. One of the best ways to keep the creditors from contacting you during your festivities is to file before the season. When you file, a court injunction known as automatic stay protects you from debt collectors.

Filing earlier in the year means the automatic stay injunction will protect your holiday celebrations from being affected by things like:

  • Foreclosure and eviction from your home
  • Repossession of your vehicle
  • Utility disconnection
  • Contact from credit card and other collectors

Choosing to file for bankruptcy earlier in the year gives you peace of mind that collections companies will leave you alone during the holiday season. As a result, you can spend your holidays focusing on those that matter most to you instead of worrying about debt.

How Can Filing for Bankruptcy After the Holidays Affect My Bankruptcy Case?

If you choose to file for bankruptcy after the holidays, you may run the risk of making your case last much longer than needed. Many employers give bonuses during December, which can falsely inflate your income. This can have an effect on the income-based test that dictates the chapter of bankruptcy that you are eligible to file.

To prevent your income from being inaccurately evaluated, file for bankruptcy before receiving any potential bonuses or monetary gifts. Filing earlier in the year ensures that the people reviewing your case have the most accurate representation of your financial situation. However, a bonus earned but not yet paid can be an asset in a Chapter 7 bankruptcy case.

The Advantages of Hiring a Bankruptcy Attorney

Filing for bankruptcy is a significant decision that can have a profound impact on your financial future. By hiring a bankruptcy attorney, you gain access to their knowledge, experience, and legal representation, significantly increasing your chances of a successful outcome. From navigating the complexities of the bankruptcy process to protecting your assets and negotiating with creditors, an attorney will guide you every step of the way.

Here are some key advantages of hiring a bankruptcy attorney:

1. Expertise and Legal Guidance

Bankruptcy attorneys have a deep understanding of bankruptcy law and can guide you through the process with ease.

2. Protection from Creditors and Debt Collectors

Attorneys can act as your advocate, defending your petition or payment plan in court and negotiating with creditors on your behalf.

3. Minimization of Costly Mistakes

Attorneys ensure that all necessary petitions and schedules are completed and filed correctly, minimizing the risk of costly errors.

4. Legal Representation and Peace of Mind

Having an attorney by your side provides you with legal representation throughout the bankruptcy process, giving you peace of mind.

5. Knowledge of Bankruptcy Exemptions

Attorneys understand the applicable exemptions in your state and can help you take full advantage of them.

6. Negotiation Skills

Bankruptcy attorneys are skilled negotiators who can work with your creditors to reach favorable agreements.

7. Chapter 13 Expertise

If you’re considering filing for Chapter 13 bankruptcy, an attorney can provide expertise in developing a fair payment plan and negotiating with the trustee.

8. Mortgage and Home Protection

Attorneys can negotiate with mortgage lenders and help you find the best path to retaining your home.

9. Personalized Guidance and Support

Attorneys provide personalized guidance tailored to your specific circumstances and offer support throughout the process.

10. Long-Term Financial Benefits

Attorneys can advise you on rebuilding your credit after bankruptcy and making sound financial decisions moving forward.

In conclusion, if you're considering bankruptcy, it's crucial to carefully weigh the timing of your filing, especially in relation to the holiday season. Whether you choose to file before or after the holidays, consulting with an experienced bankruptcy attorney is highly recommended. They can help you navigate the process, protect your interests, and ensure that you make the best decisions for your financial future.

Need Help Navigating Your Bankruptcy Options? Ready To Speak With An Experienced Bankruptcy Attorney in Baltimore, Maryland? 

At The Law Offices of Nicholas J. Del Pizzo, III P.A. in Baltimore, Maryland, we make ourselves available for our clients when they are facing foreclosure of their home, bankruptcy, personal injury, or medical malpractice. Your case becomes our cause, and we will seek the best resolution possible, providing you with the guidance and support you need during this challenging time.

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