When you are getting ready to file for bankruptcy in Tennessee, you must be even more careful with your financial actions. Otherwise, certain mistakes can slow or derail the process.
This can be especially true when it comes to your credit card usage.
1. Accumulating new, unnecessary debt
The average credit card balance in Tennessee is $5,688. Accumulating new credit card debt can complicate your financial situation and may impact the outcome of your bankruptcy proceedings. Exercise restraint and resist the temptation to make unnecessary purchases on credit. Food, utilities and rent expenses are usually OK.
2. Transferring balances
Balance transfers can be appealing due to lower interest rates, among other reasons. However, creditors and the bankruptcy court may view such transfers skeptically.
3. Concealing assets
Hiding assets by making large credit card purchases or transferring funds to undisclosed accounts can have severe consequences. Such actions may lead to accusations of defrauding creditors. They could result in legal repercussions. Full transparency is important during this time, and any attempt to conceal assets may undermine the integrity of your case.
4. Ignoring credit card statements
Do not ignore your credit card statements. Regularly reviewing them helps you stay informed about your financial situation and identify any discrepancies. If you ignore, you may miss opportunities to rectify errors or address unauthorized charges. This can worsen your financial troubles.
5. Making large cash advances
Taking out substantial cash advances on your credit card shortly before filing for bankruptcy can raise red flags. Creditors may view these transactions as an attempt to obtain funds to shield during bankruptcy.
Managing your credit wisely right before and during bankruptcy helps you navigate the process more effectively and work toward a fresh financial start.