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Big Purchases After Filing Bankruptcy in Minneapolis, Minnesota

Written by Amanda Scharber | October 20, 2024 at 10:30 AM

When you file bankruptcy, you may be worried about big purchases after the filing. Will it hinder your case? Will the asset be involved in the case? Do you need court permission to spend money? This blog will explore answers to these questions and more. 

First, bankruptcy filings look at transactions and assets from the day of filing and before. Meaning, if after filing you buy something, it would not be an asset of your bankruptcy estate. Bankruptcy also only includes debts that were incurred prior to filing, meaning, if you finance something after your case was filed that is debt you are still responsible for and is not subject to discharge in your case. 

Second, you may need court permission for a big purchase after filing bankruptcy. For example, if you are purchasing a house in a chapter 13 case, you should speak with your attorney as your case trustee will want to approve of the purchase. If you are financing a vehicle after filing, you may not need permission, depending on case type and trustee. In a chapter 13 case, the court does not want new debt taken out that will hinder your case, which is why the trustee’s will look at approving bigger financing. 

What if your purchase is big, but not house or vehicle big- you may not need permission, but you should always ask your attorney if you are worried about it or are questioning the purchase. Your attorney can help you decide if you would need to do anything specific. 

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If you have questions about bankruptcy and would like to do a free consultation to go over your options, visit www.lifebacklaw.com to speak with an attorney. You will be glad you did!