Lawyer Referral Service

LRS Blog

Posted by: Maricopa Lawyers on Jul 19, 2016

There are some circumstances in which it makes more sense to hold off on filing for bankruptcy. The time that you file for bankruptcy could mean the difference in losing or keeping your property, or filing a chapter 7 or a chapter 13. Knowing when to file will help you achieve the best outcome possible out of your bankruptcy.

When you should wait to file bankruptcy


debt resolution

There are a number of possibilities you should consider before filing bankruptcy.

  • If you have an opportunity to modify your mortgage: While filing for bankruptcy can help you avoid your home going into foreclosure, filing too early can make it difficult for you to get a mortgage modification. After you file for bankruptcy, many mortgage lenders will refuse to modify or continue to modify your mortgage. If you’re hoping to modify your mortgage in the future, you should try to avoid bankruptcy.
  • If your recent income has been high: If your income has been too high, you may be required to file for chapter 13 bankruptcy which requires you to repay some of your debts. If your income has lowered from what your previously made, you should wait a few months before filing for bankruptcy so your six-month average gross income drops.
  • If you have property you don’t want to lose: If you have property or assets you don’t want to lose in the bankruptcy, waiting to file gives you the chance that the value will depreciate so you can keep it or give you enough time to at least sell your property or assets.
  • If you anticipate having new debts soon: Chapter 7 bankruptcy erases any debt you have as of the date you file. If you know of any significant expenses you have in the near future you may want to hold off on filing until after those expenses come.