Wednesday, October 1, 2014

Bankruptcy Roulette ... "What could possibly happen?"

Image courtesy of patrisyu at
When a client walks into my office to discuss bankruptcy, they usually ask what can happen or how long before creditors take action. These questions are not easy to answer. The answer to "what can happen" is everything from nothing to having a sheriff show up at your home to cease and sell your stuff. In Pennsylvania, creditors cannot garnish your wages but there is nothing from stopping them from garnishing your bank accounts and the chance at a paycheck if you have automatic deposit that hits before you know your account has been garnished.

In a previous blog, I talked about not panicking because someone threatens to sue you. I talked about and believe debtors and attorneys need to take time to understand the case they are getting ready to file. In addition to understanding the details, debtors should plan their bankruptcy when they can. The debtor should o work with an attorney and file the case on the debtor's timetable. Too many times people wait until a hearing is pending or a sheriff's sale is scheduled. It can be too late sometimes. If someone ceases money before the debtor files, the debtor may loose it. If a landlord wins an order for eviction or if a sheriff's sale on a house happens, the debtor may lose the ability to save their home.

If a debtor waits until the last minute, he or she may loose valuable assets they could have used for a new start. Within the last week, I've help or am helping people who almost lost two weeks pay in a garnishment action and had the power turned off in their home. They knew they were probably going to file for bankruptcy and that creditors were looking for their assets. They were hoping or betting the creditors would come this week.

Bankruptcy attorneys all over the internet tell people not to wait... not to throw good money after bad... not to put off the inevitable. If you know you are in financial trouble, talk to an attorney and make a plan. Don't let a creditor force you into a decision.


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