Bankruptcy Basics: No Spending Sprees

It should be obvious, but it’s worth harping on the point that you should be extremely careful about your spending habits in the final weeks and months leading up to your hearing in the Texas bankruptcy courts.  The courts have a certain term for reckless spending, and it’s not a pretty one: fraud.

It’s Easy to See

For those who are approaching a court date (or intend to), knowing what kind of spending to seriously avoid is one of the most essential bankruptcy basics.  While you should avoid as much spending as possible for your own financial well-being, you need to consider all of your purchases through the eyes of the court.  Really, you can’t afford not to consider your purchases through this lens because your most recent records will definitely be scrutinized by the Texas bankruptcy courts.

If you’ve gone on a spending spree prior to your filing, the court will see this, and call you out on fraud.  Not even the best bankruptcy professionals can help you out of this one.  There are a lot of steps in the bankruptcy process that depend on you, and keeping these kinds of spending sprees under control is a major one.

If you have concerns about what may constitute unreasonable or lavish spending, definitely contact your bankruptcy attorney before making that purchase.  However, if you don’t have the opportunity to reach your attorney (or if you don’t have one), a good rule of thumb is to avoid the questionable purchase.