Most often when individuals are thinking about going bankrupt they are highly concerned about the assets that they own that they may lose through a bankruptcy action. Sometimes they are in such a panic state that they will take steps to protect these assets before their filing.
What they may do is attempt to transfer the property into another person’s name. They may choose a close relative or friend to do this so that when they file for bankruptcy these assets will not appear. What they don’t realize is that the previous actions leading up to the bankruptcy will be considered by the court, which will mean at that this transfer of assets will come into light and will be frowned upon by the bankruptcy trustee. The bankruptcy trustee could actually take steps to take the property back as well as deny the bankruptcy discharge.
Another step that some will take is that they will sell off their assets figuring that if they get a little money from them it is better than none, thinking they’re going to lose them in their bankruptcy proceedings. If the sale of the asset was at such a low value compared to the market value the bankruptcy courts may see this as being an illegal transfer. This will be especially true if the property is such that it is not considered to be exempt during the bankruptcy proceeding.
Another step that an individual may take is to pay off any loans that they owe to their family before filing for the bankruptcy. This can also be a dangerous step as any payments made within a 90 day period before filing for bankruptcy will be scrutinized and the bankruptcy trustee will disallow those payments. The reason being is because other creditors are not receiving their payments which may take precedence over the family debt.
As soon as you realize that you are in a tough financial situation that could possibly lead you to bankruptcy you should speak with a Fort Worth Bankruptcy Attorney to find out what you should do leading up to the filing of your bankruptcy.