Posted by: California Bankruptcy Attorney in MyBlog on Feb 23, 2010
It's a natural instinct to want to repay family and friends before filing for bankruptcy. After all, they were there for you, lending you money long after bill collectors were starting to hound you. They knew you were in financial trouble, and maybe they even knew there was a good chance you weren't going to pay them back. It's almost a point of honor to try to repay family and friends before bankruptcy proceedings begin.
But don't do it.
As a competent California bankruptcy attorney can explain to you, trying to repay family and friends in advance of bankruptcy is frowned upon by the courts. Your Chapter 7 bankruptcy lawyer or Chapter 13 bankruptcy lawyer can explain to you that bankruptcy laws are designed to treat all your creditors fairly. When you give payments that favor one creditor over another, the court calls these “preferences”, and hands the job to the Bankruptcy Trustee to recover the payments that you made.
Bankruptcy Trustees are unsympathetic and objective. As your California bankruptcy lawyer can tell you, it may seem that the Trustee is cruel, but it is simply their job. They aren't interested in who you borrowed money from or why the money was borrowed.
Get the Advice of a Qualified California Bankruptcy Lawyer
Often times, your California bankruptcy lawyer can help you negotiate a settlement with the Bankruptcy Trustee that enables your family and friends to avoid dealing with the Trustee. To avoid any potential problems or complications, and to make sure your friends and relatives get treated as fairly as possible, you should definitely enlist the help of a California bankruptcy lawyer. The sooner you find a Chapter 7 or Chapter 13 bankruptcy lawyer, the more likely it will be that you can pay your family and friends back what you owe them.
A California Bankruptcy Lawyer in Your Area
For residents of Southern California, contact the Wilshire Law Group first. With a commitment to work unwaveringly to represent clients facing bankruptcy, the Wilshire Law Group can provide you with a California bankruptcy lawyer who has worked with many people who found themselves in sticky financial situations, just like yours. These days, with California experiencing more job loss than at any other time in recent decades, it's not unusual at all for hard-working Californians to need the help of a California bankruptcy lawyer. Between prolonged job loss and unexpected medical situations, the California bankruptcy lawyer from the Wilshire Law Group assigned to your case has seen it all. They stand ready to help you through this challenging time.