The holiday season can serve as a reminder of financial stress for many people. If you are facing insurmountable debt, it might be time to consider your debt-relief options, including a possible bankruptcy case. If you are thinking of filing for bankruptcy during or after the holidays, you should discuss the matter with an experienced bankruptcy lawyer in Melbourne. The following are only a couple of many considerations you should discuss with your attorney.
Avoid Holiday Overspending
If you are filing for bankruptcy, and you expect your credit card balances to be discharged, it can be tempting to rack up your credit cards to have a more luxurious holiday than you otherwise might. However, this is a big mistake.
Bankruptcy courts will not discharge credit card balances or other debts incurred within three months of filing for bankruptcy unless they are for necessary expenses. Gifts, provisions for holiday parties, fancy outfits, and similar purchases will not qualify as necessary expenses. For this reason, you could get stuck with that debt after bankruptcy. In some cases, the bankruptcy trustee might even allege fraud, since you never intended to repay those debts.
Many people look forward to end-of-the-year bonuses, overtime due to higher demand over the holidays, or extra commission payments. All of this can increase your income for the purposes of qualifying for Chapter 7 bankruptcy. If your income is too high to pass the means test, you might need to delay your bankruptcy by several months or file under Chapter 13 instead.
Consult with a Bankruptcy Lawyer in Melbourne about Your Options
If you are considering bankruptcy, you should consult with a Melbourne bankruptcy attorney at Harnage Law before you make any financial decisions for the holidays. Contact us online or call 321.549.7886 for a consultation today.