The Timing of Your Bankruptcy Filing

Posted by Col Ovik on June 6, 2022 at 7:30 AM
Col Ovik

shutterstock_1987050107Carefully considering when to file your bankruptcy can maximize the benefit you achieve from the filing. There are many factors that may speed-up or delay the need to file. 

Garnishments: If you have a pending garnishment it is key to file quickly to prevent the garnishment. A bankruptcy filing will stop a wage garnishment, however, the debtor will have to wait for the creditor to send the garnishment release notice to the employer before the garnishment will cease. 

Lawsuits: The filing of the bankruptcy petition will stop any pending litigation against you. If the lawsuit has proceeded to the point where a judgment has been entered against you, a chapter 7 bankruptcy will void the judgment and eliminate the underlying debt.

Fraudulent Transfers/Preferences: If you have given away a significant assets to family members/friends within the years preceding the bankruptcy filing, it may be better to wait to file your bankruptcy. The bankruptcy trustee has the power to avoid that transfer to and recover the asset and then sell it to pay your creditors. This was to prevent bankruptcy filers from merely transferring all of their assets to family members/friends and then filing for bankruptcy.

This also applies to the repayment of loans to family members/friends. If you borrowed money from a family member, and you have been re-paying the loan, it may be necessary to wait to file your bankruptcy case, or risk having to pay-back to the bankruptcy estate the amount of funds repaid to your family members/friends.  

Credit Card Use: Bankruptcy debtors should be careful with credit card use immediately prior to filing bankruptcy.

Substantial purchases or cash advances on your credit cards may a red flag to creditors about potential fraud. It may be better to wait to file the case. Creditors can object to the discharge of your debt if the debtor was intentionally increasing their debt with no intention of re-paying it. 

Foreclosure: Filing bankruptcy will stop the foreclosure of your home (if filing a chapter 7 the foreclosure will be temporarily stayed). As soon as your bankruptcy case is filed, the court will issue an order stopping any collection efforts against you or any of your property. 


There are number of elements to consider when determining the timing of the filing of your bankruptcy case. Contact the attorneys at LifeBackLaw and see us at and let us help you get your life back.



Topics: BANKRUPTCY FILING, Bankruptcy preceedings

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