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3 BIG NO NO’S WHEN YOU FILE FOR BANKRUPTCY

When you file for BANKRUPTCY IN MICHIGAN there are 3 things that you never do:

1. Never lie. – tell the truth – fraud in an Bankruptcy proceeding is a 2 year felony and up to a $250,000 fine.

2. Don’t make any preference payments or transfers – you can’t prefer one creditor over another and you can’t make transfers – sell things – for less than fair market value. Another biggie that comes up all the time is – You can’t repay loans to relatives within one year of filing. 

3. No fraudulent conveyances. Don’t try to hide assets. You will get caught. The transfer will get set aside and the Trustee will take the asset.

These are simple rules and they come up all the time. If you get caught lying or trying to hide assets – good luck. Your case will get dismissed and you will be SOL!

If you make a preference payment to a creditor or to a relative – the Trustee will go after that money. It really is that simple.Your mom, dad, brother, sister, aunt, uncle, cousin, etc. – will be really upset with you – because if you don’t pay the money to the Trustee – the Trustee goes after them.

PS – Just remember – under the new law – anything that you tell your attorney has to be disclosed in your schedules and statements.

PSS – Just like you were taught – honesty is the best policy. When we practice to deceive, webs of tangle do we weave.

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